Enbridge (NYSE: ENB) and Enbridge Energy Management (NYSE:EEQ) are both energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, profitability, earnings, dividends, risk and institutional ownership.
Volatility & Risk
Enbridge has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500. Comparatively, Enbridge Energy Management has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500.
62.6% of Enbridge shares are held by institutional investors. Comparatively, 74.7% of Enbridge Energy Management shares are held by institutional investors. 0.3% of Enbridge Energy Management shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This table compares Enbridge and Enbridge Energy Management’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Enbridge Energy Management||N/A||-800.00%||-800.00%|
Enbridge pays an annual dividend of $1.92 per share and has a dividend yield of 5.5%. Enbridge Energy Management does not pay a dividend. Enbridge pays out 123.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Enbridge has raised its dividend for 6 consecutive years.
This is a summary of current recommendations and price targets for Enbridge and Enbridge Energy Management, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Enbridge Energy Management||1||1||0||0||1.50|
Enbridge presently has a consensus target price of $51.25, suggesting a potential upside of 46.30%. Enbridge Energy Management has a consensus target price of $18.00, suggesting a potential upside of 40.63%. Given Enbridge’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Enbridge is more favorable than Enbridge Energy Management.
Earnings & Valuation
This table compares Enbridge and Enbridge Energy Management’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Enbridge||$25.89 billion||2.24||$1.56 billion||$1.56||22.46|
|Enbridge Energy Management||N/A||N/A||-$120.10 million||($0.07)||-182.86|
Enbridge has higher revenue and earnings than Enbridge Energy Management. Enbridge Energy Management is trading at a lower price-to-earnings ratio than Enbridge, indicating that it is currently the more affordable of the two stocks.
Enbridge beats Enbridge Energy Management on 12 of the 16 factors compared between the two stocks.
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.
About Enbridge Energy Management
Enbridge Energy Management, L.L.C. is a limited partner of Enbridge Energy Partners, L.P. (the Partnership). The Company owns i-units, a special class of the Partnership’s limited partner interests. The Company manages the business of the Partnership. The Partnership owns and operates crude oil and liquid petroleum transportation and storage assets, and natural gas gathering, treating, processing, transportation and marketing assets in the United States.
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