Contrasting Enlink Midstream (XTXI) and Suncor Energy (SU)

Enlink Midstream (NASDAQ: XTXI) and Suncor Energy (NYSE:SU) are both oil & gas refining and marketing – nec companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.

Profitability

This table compares Enlink Midstream and Suncor Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Enlink Midstream N/A N/A N/A
Suncor Energy 11.63% 5.68% 2.91%

Dividends

Suncor Energy pays an annual dividend of $1.01 per share and has a dividend yield of 2.9%. Enlink Midstream does not pay a dividend. Suncor Energy pays out 60.8% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Enlink Midstream and Suncor Energy’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Enlink Midstream N/A N/A N/A ($0.52) -72.31
Suncor Energy $20.20 billion 2.81 $327.75 million $1.66 20.67

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

Insider and Institutional Ownership

65.6% of Suncor Energy shares are held by institutional investors. 1.0% of Suncor Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Enlink Midstream and Suncor Energy, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Enlink Midstream 0 0 0 0 N/A
Suncor Energy 0 4 10 1 2.80

Suncor Energy has a consensus target price of $43.66, suggesting a potential upside of 27.25%. Given Suncor Energy’s higher probable upside, analysts clearly believe Suncor Energy is more favorable than Enlink Midstream.

Summary

Suncor Energy beats Enlink Midstream on 11 of the 12 factors compared between the two stocks.

About Enlink Midstream

Enlink Midstream Partners, L.P. is engaged, through its subsidiaries, in the gathering, transmission, processing and marketing of natural gas and natural gas liquids (NGLs). The Company connects the wells of natural gas producers in the geographic areas of its gathering systems in order to gather for a fee or purchase the gas production, processes natural gas for the removal of NGLs, transports natural gas and NGLs and ultimately provides natural gas and NGLs to a variety of markets. In addition, it purchases natural gas and NGLs from producers not connected to its gathering systems for resale and markets natural gas and NGLs on behalf of producers for a fee. Its partnership interests consist of 19.7% limited partner interest in Crosstex Energy, L.P. (the Partnership), as of December 31, 2012, and 100% ownership interest in Crosstex Energy GP, LLC, the general partner of the Partnership, which owns a 2.0% general partner interest and all of the distribution rights in the Partnership.

About Suncor Energy

Suncor Energy Inc is a Canada-based integrated energy company. The Company is focused on developing Canada’s petroleum resource basin, Athabasca oil sands. The Company operates in three business segments: Oil Sands, Exploration and Production (E&P), and Refining and Marketing. The Company’s Oil Sands segment includes Oil Sands operations and Oil Sands ventures operations. Its E&P segment consists of offshore operations off the east coast of Canada and in the North Sea, and onshore assets in North America, Libya and Syria. The Company’s Refining and Marketing segment is engaged in Refining and Supply, and Marketing operations. In addition, it explores for, acquires, develops, produces and markets crude oil and natural gas in Canada and internationally. It transports and refines crude oil, and markets petroleum and petrochemical products primarily in Canada. It markets third-party petroleum products. The Company also conducts energy trading activities.

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