Contrasting Hess Midstream Partners (NYSE:HESM) and TXO Partners (NYSE:TXO)

TXO Partners (NYSE:TXOGet Free Report) and Hess Midstream Partners (NYSE:HESMGet Free Report) are both energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitability.

Risk and Volatility

TXO Partners has a beta of 0.08, indicating that its share price is 92% less volatile than the S&P 500. Comparatively, Hess Midstream Partners has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500.

Earnings & Valuation

This table compares TXO Partners and Hess Midstream Partners”s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
TXO Partners $282.81 million 2.22 $23.50 million $0.42 36.21
Hess Midstream Partners $1.50 billion 5.60 $223.10 million $2.55 15.24

Hess Midstream Partners has higher revenue and earnings than TXO Partners. Hess Midstream Partners is trading at a lower price-to-earnings ratio than TXO Partners, indicating that it is currently the more affordable of the two stocks.

Dividends

TXO Partners pays an annual dividend of $2.44 per share and has a dividend yield of 16.0%. Hess Midstream Partners pays an annual dividend of $2.84 per share and has a dividend yield of 7.3%. TXO Partners pays out 581.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hess Midstream Partners pays out 111.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TXO Partners has raised its dividend for 1 consecutive years and Hess Midstream Partners has raised its dividend for 8 consecutive years.

Insider & Institutional Ownership

27.4% of TXO Partners shares are owned by institutional investors. Comparatively, 99.0% of Hess Midstream Partners shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares TXO Partners and Hess Midstream Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TXO Partners 5.22% 3.89% 2.41%
Hess Midstream Partners 16.43% 54.89% 6.02%

Analyst Ratings

This is a summary of recent recommendations for TXO Partners and Hess Midstream Partners, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TXO Partners 0 0 1 0 3.00
Hess Midstream Partners 0 2 3 0 2.60

TXO Partners currently has a consensus price target of $20.00, indicating a potential upside of 31.50%. Hess Midstream Partners has a consensus price target of $42.80, indicating a potential upside of 10.12%. Given TXO Partners’ stronger consensus rating and higher probable upside, analysts clearly believe TXO Partners is more favorable than Hess Midstream Partners.

Summary

Hess Midstream Partners beats TXO Partners on 12 of the 16 factors compared between the two stocks.

About TXO Partners

(Get Free Report)

TXO Partners, L.P., an oil and natural gas company, focuses on the acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquid reserves in North America. Its acreage positions are concentrated in the Permian Basin of West Texas and New Mexico and the San Juan Basin of New Mexico and Colorado. The company was formerly known as TXO Energy Partners, L.P. and changed its name to TXO Partners, L.P. in May 2023. TXO Partners, L.P. was incorporated in 2012 and is based in Fort Worth, Texas.

About Hess Midstream Partners

(Get Free Report)

Hess Midstream LP owns, develops, operates, and acquires midstream assets and provide fee-based services to Hess and third-party customers in the United States. It operates through three segments: Gathering; Processing and Storage; and Terminaling and Export. The Gathering segment owns natural gas gathering and compression systems; crude oil gathering systems; and produced water gathering and disposal facilities. Its gathering systems consists of approximately 1,410 miles of high and low pressure natural gas and natural gas liquids gathering pipelines with capacity of approximately 660 million cubic feet per day; crude oil gathering system comprises approximately 570 miles of crude oil gathering pipelines; and produced water gathering system that includes approximately 300 miles of pipelines in gathering systems. The Processing and Storage segment comprises Tioga Gas Plant, a natural gas processing and fractionation plant located in Tioga, North Dakota; a 50% interest in the Little Missouri 4 gas processing plant located in south of the Missouri River in McKenzie County, North Dakota; and Mentor Storage Terminal, a propane storage cavern and rail, and truck loading and unloading facility located in Mentor, Minnesota. The Terminaling and Export segment owns Ramberg terminal facility; Tioga rail terminal; crude oil rail cars; and other Dakota access pipeline connections, as well as Johnson's Corner Header System, a crude oil pipeline header system. Hess Midstream LP was founded in 2014 and is based in Houston, Texas.

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