Pembina Pipeline (NYSE: PBA) and Delek Logistics Partners (NYSE:DKL) are both oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, analyst recommendations, earnings, profitability, institutional ownership and dividends.
This is a summary of recent ratings and price targets for Pembina Pipeline and Delek Logistics Partners, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Delek Logistics Partners||0||2||0||0||2.00|
Pembina Pipeline presently has a consensus price target of $44.00, indicating a potential upside of 25.89%. Delek Logistics Partners has a consensus price target of $32.50, indicating a potential upside of 13.44%. Given Pembina Pipeline’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Pembina Pipeline is more favorable than Delek Logistics Partners.
Pembina Pipeline pays an annual dividend of $1.70 per share and has a dividend yield of 4.9%. Delek Logistics Partners pays an annual dividend of $2.86 per share and has a dividend yield of 10.0%. Pembina Pipeline pays out 171.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Delek Logistics Partners pays out 143.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pembina Pipeline has raised its dividend for 3 consecutive years. Delek Logistics Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings and Valuation
This table compares Pembina Pipeline and Delek Logistics Partners’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Pembina Pipeline||$3.22 billion||5.45||$351.92 million||$0.99||35.30|
|Delek Logistics Partners||$448.06 million||1.59||$62.80 million||$1.99||14.40|
Pembina Pipeline has higher revenue and earnings than Delek Logistics Partners. Delek Logistics Partners is trading at a lower price-to-earnings ratio than Pembina Pipeline, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Pembina Pipeline has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500. Comparatively, Delek Logistics Partners has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500.
This table compares Pembina Pipeline and Delek Logistics Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Delek Logistics Partners||12.86%||-332.86%||15.79%|
Insider and Institutional Ownership
42.5% of Pembina Pipeline shares are owned by institutional investors. Comparatively, 25.1% of Delek Logistics Partners shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Pembina Pipeline beats Delek Logistics Partners on 10 of the 16 factors compared between the two stocks.
About Pembina Pipeline
Pembina Pipeline Corporation is an energy transportation and service provider. The Company operates through four segments. The Conventional Pipelines segment consists of the tariff-based operations of pipelines and related facilities to deliver crude oil, condensate and natural gas liquids (NGL) in Alberta, British Columbia, Saskatchewan, and North Dakota, United States. The Oil Sands & Heavy Oil segment consists of the Syncrude, Horizon, Nipisi and Mitsue Pipelines, and the Cheecham Lateral. These pipelines and related facilities deliver synthetic crude oil produced from oil sands under long-term cost-of-service arrangements. The Gas Services segment consists of natural gas gathering and processing facilities. The Midstream segment consists of the Company’s interests in extraction and fractionation facilities, terminalling and storage hub services under a mixture of short, medium and long-term contractual arrangements.
About Delek Logistics Partners
Delek Logistics Partners, LP owns and operates logistics and marketing assets for crude oil, and intermediate and refined products. The Company’s business primarily consists of certain crude oil, intermediate and refined products pipelines and transportation, storage, wholesale marketing, terminaling and offloading assets, which were previously owned, operated or held by Delek US Holdings, Inc. (Delek), and assets acquired from unrelated third parties. The Company operates through two segments: Pipelines and Transportation segment, and Wholesale Marketing and Terminalling segment. The Company engaged in the gathering, transporting and storing crude oil; storing intermediate products and feed stocks, and marketing, distributing, transporting, offloading and storing refined products. The Company also provides crude oil, intermediate and refined products transportation services for terminaling, and marketing services to third parties primarily in Texas, Tennessee and Arkansas.
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