Analyzing Murphy USA (MUSA) & Golar LNG Partners (GMLP)

Golar LNG Partners (NASDAQ: GMLP) and Murphy USA (NYSE:MUSA) are both oils/energy companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Analyst Ratings

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This is a summary of current ratings and price targets for Golar LNG Partners and Murphy USA, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Golar LNG Partners 0 2 4 0 2.67
Murphy USA 1 5 0 0 1.83

Golar LNG Partners currently has a consensus target price of $23.60, suggesting a potential upside of 28.68%. Murphy USA has a consensus target price of $76.67, suggesting a potential upside of 19.96%. Given Golar LNG Partners’ stronger consensus rating and higher possible upside, equities analysts clearly believe Golar LNG Partners is more favorable than Murphy USA.

Institutional and Insider Ownership

44.0% of Golar LNG Partners shares are held by institutional investors. Comparatively, 93.2% of Murphy USA shares are held by institutional investors. 8.1% of Murphy USA shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Golar LNG Partners has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500. Comparatively, Murphy USA has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Earnings and Valuation

This table compares Golar LNG Partners and Murphy USA’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Golar LNG Partners $433.10 million 3.01 $129.28 million $1.88 9.76
Murphy USA $12.83 billion 0.17 $245.26 million $4.32 14.79

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

Profitability

This table compares Golar LNG Partners and Murphy USA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Golar LNG Partners 29.85% 17.19% 5.43%
Murphy USA 1.91% 22.69% 7.08%

Dividends

Golar LNG Partners pays an annual dividend of $2.31 per share and has a dividend yield of 12.6%. Murphy USA does not pay a dividend. Golar LNG Partners pays out 122.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Murphy USA beats Golar LNG Partners on 9 of the 16 factors compared between the two stocks.

About Golar LNG Partners

Golar LNG Partners LP engages in the logistics solutions. Its activities include owning, trading, and operation of floating storage and regasification units (FSRU) and liquefied natural gas ( LNG) marine transportation. The company was founded on September 24, 2007 and is headquartered in Hamilton, Bermuda.

About Murphy USA

Murphy USA Inc. operates a chain of retail stores in the United States. The company's retail stores offer motor fuel products and convenience merchandise. It operates retail stores under the Murphy USA and Murphy Express brand names. As of January 31, 2018, the company operated approximately 1,446 retail stores located primarily in the Southwest, Southeast, and Midwest United States. Murphy USA Inc. was incorporated in 2013 and is headquartered in El Dorado, Arkansas.

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