DCP Midstream (NYSE:DCP) and Enterprise Products Partners (NYSE:EPD) are both oils/energy companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, profitability, valuation and risk.
DCP Midstream pays an annual dividend of $3.12 per share and has a dividend yield of 9.4%. Enterprise Products Partners pays an annual dividend of $1.73 per share and has a dividend yield of 6.6%. DCP Midstream pays out 588.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Enterprise Products Partners pays out 131.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Enterprise Products Partners has raised its dividend for 19 consecutive years.
Volatility and Risk
DCP Midstream has a beta of 2.27, indicating that its stock price is 127% more volatile than the S&P 500. Comparatively, Enterprise Products Partners has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500.
Insider & Institutional Ownership
55.1% of DCP Midstream shares are held by institutional investors. Comparatively, 37.3% of Enterprise Products Partners shares are held by institutional investors. 0.0% of DCP Midstream shares are held by insiders. Comparatively, 37.5% of Enterprise Products Partners shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This table compares DCP Midstream and Enterprise Products Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Enterprise Products Partners||10.23%||16.28%||6.71%|
This is a breakdown of recent recommendations and price targets for DCP Midstream and Enterprise Products Partners, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Enterprise Products Partners||0||1||19||1||3.00|
DCP Midstream currently has a consensus price target of $43.40, suggesting a potential upside of 31.44%. Enterprise Products Partners has a consensus price target of $32.74, suggesting a potential upside of 24.95%. Given DCP Midstream’s higher possible upside, equities research analysts clearly believe DCP Midstream is more favorable than Enterprise Products Partners.
Valuation & Earnings
This table compares DCP Midstream and Enterprise Products Partners’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|DCP Midstream||$8.46 billion||0.56||$229.00 million||$0.53||62.30|
|Enterprise Products Partners||$29.24 billion||1.94||$2.80 billion||$1.32||19.85|
Enterprise Products Partners has higher revenue and earnings than DCP Midstream. Enterprise Products Partners is trading at a lower price-to-earnings ratio than DCP Midstream, indicating that it is currently the more affordable of the two stocks.
Enterprise Products Partners beats DCP Midstream on 13 of the 18 factors compared between the two stocks.
DCP Midstream Company Profile
DCP Midstream, LP, together with its subsidiaries, owns, operates, acquires, and develops a portfolio of midstream energy assets in the United States. The company operates in two segments, Gathering and Processing, and Logistics and Marketing. The Gathering and Processing segment is involved in gathering, compressing, treating, and processing natural gas; producing and fractionating natural gas liquids (NGLs); and recovering condensate. The Logistics and Marketing segment engages in transporting, trading, marketing, and storing natural gas and NGLs; fractionating NGLs; and wholesale propane logistics. As of February 13, 2018, it owned and operated approximately 60 plants and 63,000 miles of natural gas and NGLs pipelines with operations in 17 states. The company serves petrochemical and refining companies, and retail propane distributors. DCP Midstream GP, LP serves as the general partner of the company. The company was formerly known as DCP Midstream Partners, LP and changed its name to DCP Midstream, LP in January 2017. DCP Midstream, LP was founded in 2005 and is headquartered in Denver, Colorado.
Enterprise Products Partners Company Profile
Enterprise Products Partners L.P. provides midstream energy services to producers and consumers of natural gas, natural gas liquids (NGLs), crude oil, petrochemicals, and refined products. The company operates through four segments: NGL Pipelines & Services, Crude Oil Pipelines & Services, Natural Gas Pipelines & Services, and Petrochemical & Refined Products Services. The NGL Pipelines & Services segment offers natural gas processing and related NGL marketing services, as well as NGL export docks and related services. It operates approximately 19,600 miles of NGL pipelines; NGL and related product storage facilities; 14 NGL fractionators; and a liquefied petroleum gas and ethane export terminals, and related operations. The Crude Oil Pipelines & Services segment operates approximately 5,800 miles of crude oil pipelines; and crude oil storage and marine terminals located in Oklahoma and Texas, as well as a fleet of 495 tractor-trailer tank trucks used to transport crude oil. It also engages in crude oil marketing activities. The Natural Gas Pipelines & Services segment operates approximately 19,700 miles of natural gas pipeline systems to gather and transport natural gas in Colorado, Louisiana, New Mexico, Texas, and Wyoming. It leases underground salt dome natural gas storage facilities in Texas and Louisiana; owns an underground salt dome storage cavern in Texas; and markets natural gas. The Petrochemical & Refined Products Services segment operates propylene fractionation and related activities, including 800 miles of pipelines; butane isomerization complex, associated deisobutanizer units, and related pipeline assets; and octane enhancement and high purity isobutylene production facilities. It also operates approximately 4,100 miles of refined products pipelines; and terminals, as well as provides refined products marketing and marine transportation services. The company was founded in 1968 and is headquartered in Houston, Texas.
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