Head-To-Head Comparison: TransCanada (TRP) vs. EnLink Midstream (ENLC)
TransCanada (NYSE: TRP) and EnLink Midstream (NYSE:ENLC) are both mid-cap oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, earnings, risk, institutional ownership, dividends and valuation.
Volatility & Risk
TransCanada has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500. Comparatively, EnLink Midstream has a beta of 2.58, suggesting that its stock price is 158% more volatile than the S&P 500.
This table compares TransCanada and EnLink Midstream’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|TransCanada||$9.44 billion||4.54||$175.96 million||$1.55||31.53|
|EnLink Midstream||$4.25 billion||0.72||-$460.00 million||$0.03||565.19|
TransCanada has higher revenue and earnings than EnLink Midstream. TransCanada is trading at a lower price-to-earnings ratio than EnLink Midstream, indicating that it is currently the more affordable of the two stocks.
This is a summary of current ratings for TransCanada and EnLink Midstream, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
TransCanada currently has a consensus price target of $62.25, indicating a potential upside of 27.38%. EnLink Midstream has a consensus price target of $18.80, indicating a potential upside of 10.91%. Given TransCanada’s stronger consensus rating and higher possible upside, equities analysts clearly believe TransCanada is more favorable than EnLink Midstream.
TransCanada pays an annual dividend of $1.94 per share and has a dividend yield of 4.0%. EnLink Midstream pays an annual dividend of $1.02 per share and has a dividend yield of 6.0%. TransCanada pays out 125.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. EnLink Midstream pays out 3,401.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TransCanada has raised its dividend for 2 consecutive years.
Institutional and Insider Ownership
56.9% of TransCanada shares are owned by institutional investors. Comparatively, 34.1% of EnLink Midstream shares are owned by institutional investors. 1.2% of EnLink Midstream shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares TransCanada and EnLink Midstream’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
TransCanada beats EnLink Midstream on 13 of the 17 factors compared between the two stocks.
TransCanada Corporation is an energy infrastructure company. The Company is engaged in the development and operation of North American energy infrastructure, including natural gas and liquids pipelines, power generation and natural gas storage facilities. Its segments include Canadian Natural Gas Pipelines, U.S. Natural Gas Pipelines, Mexico Natural Gas Pipelines, Liquids Pipelines and Energy. The Company operates in three businesses: Natural Gas Pipelines, Liquids Pipelines and Energy. The Natural Gas Pipelines and Liquids Pipelines segments principally consist of its respective natural gas and liquids pipelines in Canada, the United States and Mexico, as well as its regulated natural gas storage operations in the United States. The Energy segment includes its power operations and the non-regulated natural gas storage business in Canada. TransCanada PipeLines Limited (TCPL) is its principal operating subsidiary.
About EnLink Midstream
EnLink Midstream, LLC is an integrated midstream company. The Company’s assets consist of equity interests in EnLink Midstream Partners, LP (the Partnership) and EnLink Oklahoma Gas Processing, LP (EnLink Oklahoma T.O.). The Partnership is engaged in the gathering, transmission, processing and marketing of natural gas and natural gas liquids (NGLs), condensate and crude oil, as well as providing crude oil, condensate and brine services to producers. EnLink Oklahoma T.O., a partnership owned by the Partnership and the Company, is engaged in the gathering and processing of natural gas. The Partnership’s segments include Texas, Oklahoma, Louisiana, Crude and Condensate, and Corporate. The Partnership connects the wells of producers in its market areas to its gathering systems, processes natural gas to remove NGLs, fractionates NGLs into purity products and markets those products for a fee, transports natural gas and provides natural gas to a range of markets.
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