Financial Survey: Tallgrass Energy Partners, (TEP) vs. Enbridge (ENB)
Tallgrass Energy Partners, (NYSE: TEP) and Enbridge (NYSE:ENB) are both mid-cap oils/energy companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, institutional ownership, risk, dividends, analyst recommendations and profitability.
Tallgrass Energy Partners, pays an annual dividend of $3.70 per share and has a dividend yield of 7.7%. Enbridge pays an annual dividend of $1.97 per share and has a dividend yield of 4.7%. Tallgrass Energy Partners, pays out 165.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Enbridge pays out 191.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tallgrass Energy Partners, has raised its dividend for 5 consecutive years and Enbridge has raised its dividend for 3 consecutive years. Tallgrass Energy Partners, is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of current recommendations for Tallgrass Energy Partners, and Enbridge, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Tallgrass Energy Partners,||0||4||5||0||2.56|
Tallgrass Energy Partners, presently has a consensus target price of $61.38, indicating a potential upside of 27.10%. Enbridge has a consensus target price of $56.00, indicating a potential upside of 33.94%. Given Enbridge’s higher probable upside, analysts plainly believe Enbridge is more favorable than Tallgrass Energy Partners,.
This table compares Tallgrass Energy Partners, and Enbridge’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Tallgrass Energy Partners,||46.63%||20.47%||9.01%|
Volatility & Risk
Tallgrass Energy Partners, has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500. Comparatively, Enbridge has a beta of 0.65, indicating that its share price is 35% less volatile than the S&P 500.
Earnings and Valuation
This table compares Tallgrass Energy Partners, and Enbridge’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Tallgrass Energy Partners,||$614.20 million||5.75||$351.11 million||$2.23||21.65|
|Enbridge||$32.98 billion||2.09||$6.11 billion||$1.03||40.59|
Enbridge has higher revenue and earnings than Tallgrass Energy Partners,. Tallgrass Energy Partners, is trading at a lower price-to-earnings ratio than Enbridge, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
62.1% of Tallgrass Energy Partners, shares are owned by institutional investors. Comparatively, 61.6% of Enbridge shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Tallgrass Energy Partners, beats Enbridge on 12 of the 16 factors compared between the two stocks.
About Tallgrass Energy Partners,
Tallgrass Energy Partners, LP owns, operates, acquires and develops midstream energy assets in North America. The Company operates through three segments: Crude Oil Transportation & Logistics, Natural Gas Transportation & Logistics and Processing & Logistics. The Crude Oil Transportation & Logistics segment includes the ownership and operation of a Federal Energy Regulatory Commission (FERC) crude oil pipeline system, and crude oil storage and terminaling facilities. The Natural Gas Transportation & Logistics segment is engaged in the ownership and operation of FERC regulated interstate natural gas pipelines and integrated natural gas storage facilities. The Processing & Logistics segment is engaged in the ownership and operation of natural gas processing, treating and fractionation facilities; the provision of water business services primarily to the oil and gas exploration and production industry, and the transportation of natural gas liquids (NGLs).
Enbridge Inc. is a Canada-based energy transportation and distribution company. The Company is engaged in delivering energy. It operates through five segments: Liquids Pipelines, Gas Distribution, Gas Pipelines and Processing, Green Power and Transmission, and Energy Services. Liquids Pipelines consists of common carrier and contract crude oil, natural gas liquids (NGL), and refined products pipelines and terminals, including Canadian Mainline, Lakehead Pipeline System, Mid-Continent and Gulf Coast and Regional Oil Sands System. Gas Distribution consists of its natural gas utility operations, the core of which is Enbridge Gas Distribution Inc. Green Power and Transmission consists of its investments in renewable energy assets and transmission facilities. Renewable energy assets consist of wind, solar, geothermal and waste heat recovery facilities in Canada. Energy Services undertake physical commodity marketing activity and logistical services, and oversee refinery supply services.
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