BP p.l.c. (NYSE: BP) and Targa Resources Partners (NYSE:NGLS) are both oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.

Profitability

This table compares BP p.l.c. and Targa Resources Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BP p.l.c. 1.74% 3.64% 1.34%
Targa Resources Partners 3.27% 0.29% 1.61%

Valuation & Earnings

This table compares BP p.l.c. and Targa Resources Partners’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
BP p.l.c. $209.85 billion 0.60 $19.97 billion $1.15 33.57
Targa Resources Partners N/A N/A N/A N/A N/A

BP p.l.c. has higher revenue and earnings than Targa Resources Partners.

Institutional and Insider Ownership

10.1% of BP p.l.c. shares are held by institutional investors. 1.0% of BP p.l.c. shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

BP p.l.c. pays an annual dividend of $2.38 per share and has a dividend yield of 6.2%. Targa Resources Partners does not pay a dividend. BP p.l.c. pays out 207.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BP p.l.c. has increased its dividend for 7 consecutive years.

Analyst Recommendations

This is a summary of current recommendations for BP p.l.c. and Targa Resources Partners, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BP p.l.c. 2 6 13 0 2.52
Targa Resources Partners 0 1 1 0 2.50

BP p.l.c. currently has a consensus price target of $36.58, indicating a potential downside of 5.27%. Targa Resources Partners has a consensus price target of $52.00, indicating a potential upside of 388.26%. Given Targa Resources Partners’ higher possible upside, analysts plainly believe Targa Resources Partners is more favorable than BP p.l.c..

Summary

BP p.l.c. beats Targa Resources Partners on 9 of the 13 factors compared between the two stocks.

BP p.l.c. Company Profile

BP p.l.c. is an integrated oil and gas company. The Company owns an interest in OJSC Oil Company Rosneft (Rosneft), an oil and gas company. The Company’s segments include Upstream, Downstream, Rosneft, and Other businesses and corporate. The Upstream segment is engaged in oil and natural gas exploration, field development and production, as well as midstream transportation, storage and processing. The Downstream segment has global manufacturing and marketing operations. The Rosneft segment has a resource base of hydrocarbons onshore and offshore. The Other businesses and corporate segment comprises the biofuels and wind businesses, shipping and treasury functions, and corporate activities around the world. The Company provides its customers with fuel for transportation, energy for heat and light, lubricants to keep engines moving and the petrochemicals products used to make everyday items as diverse as paints, clothes and packaging.

Targa Resources Partners Company Profile

Targa Resources Partners LP is a provider of midstream natural gas and natural gas liquid (NGL) services in the United States with a presence in crude oil gathering and petroleum terminaling. The Company is engaged in the business of gathering, compressing, treating, processing and selling natural gas; storing, fractionating, treating, transporting and selling NGLs and NGL products, including services to liquefied petroleum gas (LPG) exporters; gathering, storing and terminaling crude oil, and storing, terminaling and selling refined petroleum products. The Company operates in two divisions: Gathering and Processing, and Logistics and Marketing. The Gathering and Processing division consists of two segments: Field Gathering and Processing, and Coastal Gathering and Processing. The Logistics and Marketing division consists of two segments: Logistics Assets and Marketing and Distribution.

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