Critical Review: CSI Compressco (CCLP) versus The Competition

CSI Compressco (NASDAQ: CCLP) is one of 46 public companies in the “Oil Related Services and Equipment” industry, but how does it compare to its rivals? We will compare CSI Compressco to related businesses based on the strength of its risk, dividends, analyst recommendations, profitability, institutional ownership, valuation and earnings.

Institutional and Insider Ownership

28.0% of CSI Compressco shares are held by institutional investors. Comparatively, 65.6% of shares of all “Oil Related Services and Equipment” companies are held by institutional investors. 13.0% of shares of all “Oil Related Services and Equipment” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Dividends

CSI Compressco pays an annual dividend of $0.75 per share and has a dividend yield of 14.2%. CSI Compressco pays out -60.0% of its earnings in the form of a dividend. As a group, “Oil Related Services and Equipment” companies pay a dividend yield of 2.9% and pay out -93.4% of their earnings in the form of a dividend.

Earnings and Valuation

This table compares CSI Compressco and its rivals gross revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
CSI Compressco $311.36 million -$138.13 million -4.22
CSI Compressco Competitors $1.90 billion -$327.39 million 3.05

CSI Compressco’s rivals have higher revenue, but lower earnings than CSI Compressco. CSI Compressco is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

CSI Compressco has a beta of 2.06, meaning that its share price is 106% more volatile than the S&P 500. Comparatively, CSI Compressco’s rivals have a beta of 1.56, meaning that their average share price is 56% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations for CSI Compressco and its rivals, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CSI Compressco 1 3 0 0 1.75
CSI Compressco Competitors 369 2006 2838 117 2.51

CSI Compressco currently has a consensus target price of $5.33, suggesting a potential upside of 1.01%. As a group, “Oil Related Services and Equipment” companies have a potential upside of 29.29%. Given CSI Compressco’s rivals stronger consensus rating and higher possible upside, analysts clearly believe CSI Compressco has less favorable growth aspects than its rivals.

Profitability

This table compares CSI Compressco and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CSI Compressco -14.20% -35.88% -5.70%
CSI Compressco Competitors -11.25% -5.10% -3.21%

Summary

CSI Compressco rivals beat CSI Compressco on 11 of the 14 factors compared.

CSI Compressco Company Profile

CSI Compressco LP is a provider of compression services and equipment for natural gas and oil production, gathering, transportation, processing and storage. The Company sells custom-designed compressor packages and oilfield fluid pump systems, and provides aftermarket services and compressor package parts and components manufactured by third-party suppliers. It provides these compression services and equipment to a base of natural gas and oil exploration and production, midstream and transmission companies operating throughout many of the onshore producing regions of the United States, as well as in a number of foreign countries, including Mexico, Canada and Argentina. It is a service provider of natural gas compression services in the United States, utilizing its fleet of compressor packages that employs a spectrum of low-, medium- and high-horsepower engines. As of December 31, 2016, its fleet included approximately 6,000 compressor packages.

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