Enterprise Products Partners (EPD) and Plains All American Pipeline (PAA) Head-To-Head Review

Enterprise Products Partners (NYSE: EPD) and Plains All American Pipeline (NYSE:PAA) are both large-cap energy companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, dividends, risk, institutional ownership, valuation, profitability and analyst recommendations.

Earnings & Valuation

This table compares Enterprise Products Partners and Plains All American Pipeline’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Enterprise Products Partners $29.24 billion 1.98 $2.80 billion $1.11 24.15
Plains All American Pipeline $26.22 billion 0.61 $856.00 million $0.92 23.98

Enterprise Products Partners has higher revenue and earnings than Plains All American Pipeline. Plains All American Pipeline is trading at a lower price-to-earnings ratio than Enterprise Products Partners, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

36.9% of Enterprise Products Partners shares are owned by institutional investors. Comparatively, 42.7% of Plains All American Pipeline shares are owned by institutional investors. 37.5% of Enterprise Products Partners shares are owned by company insiders. Comparatively, 1.3% of Plains All American Pipeline shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for Enterprise Products Partners and Plains All American Pipeline, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Enterprise Products Partners 0 1 15 0 2.94
Plains All American Pipeline 0 13 8 0 2.38

Enterprise Products Partners presently has a consensus price target of $31.12, suggesting a potential upside of 16.06%. Plains All American Pipeline has a consensus price target of $26.39, suggesting a potential upside of 19.62%. Given Plains All American Pipeline’s higher probable upside, analysts plainly believe Plains All American Pipeline is more favorable than Enterprise Products Partners.

Risk and Volatility

Enterprise Products Partners has a beta of 0.81, suggesting that its share price is 19% less volatile than the S&P 500. Comparatively, Plains All American Pipeline has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500.

Profitability

This table compares Enterprise Products Partners and Plains All American Pipeline’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Enterprise Products Partners 9.57% 12.53% 5.47%
Plains All American Pipeline 3.26% 9.93% 3.52%

Dividends

Enterprise Products Partners pays an annual dividend of $1.70 per share and has a dividend yield of 6.3%. Plains All American Pipeline pays an annual dividend of $1.20 per share and has a dividend yield of 5.4%. Enterprise Products Partners pays out 153.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Plains All American Pipeline pays out 130.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Plains All American Pipeline has raised its dividend for 19 consecutive years.

Summary

Enterprise Products Partners beats Plains All American Pipeline on 12 of the 17 factors compared between the two stocks.

About Enterprise Products Partners

Enterprise Products Partners L.P. (Enterprise) is a provider of midstream energy services to producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, petrochemicals and refined products in North America. The Company’s segments include NGL Pipelines & Services; Crude Oil Pipelines & Services; Natural Gas Pipelines & Services, and Petrochemical & Refined Products Services. The Company’s midstream energy operations include natural gas gathering, treating, processing, transportation and storage; NGL transportation, fractionation, storage, and import and export terminals, including liquefied petroleum gas (LPG); crude oil gathering, transportation, storage and terminals; petrochemical and refined products transportation, storage, export and import terminals, and related services, and a marine transportation business that operates primarily on the United States inland and Intracoastal Waterway systems.

About Plains All American Pipeline

Plains All American Pipeline, L.P. owns and operates midstream energy infrastructure and provide logistics services for crude oil, natural gas liquids (NGL), natural gas and refined products. The Company operates through three segments: Transportation, Facilities, and Supply and Logistics. The Company’s transportation segment operations consist of activities associated with transporting crude oil and NGL on pipelines, gathering systems, trucks and barges. Its Facilities segment operations consist of activities associated with providing storage, terminaling and throughput services for crude oil, refined products, NGL and natural gas, as well as NGL fractionation and isomerization services and natural gas and condensate processing services. Its supply and logistics segment operations consist of the merchant-related activities, including the purchase of the United States and Canadian crude oil at the wellhead, the bulk purchase of crude oil at pipeline, terminal and rail facilities.

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