SemGroup (NYSE: SEMG) and Enbridge Energy Management (NYSE:EEQ) are both energy companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, profitability, analyst recommendations, institutional ownership, dividends, valuation and earnings.
This table compares SemGroup and Enbridge Energy Management’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Enbridge Energy Management||N/A||-800.00%||-800.00%|
This is a breakdown of recent recommendations for SemGroup and Enbridge Energy Management, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Enbridge Energy Management||1||1||0||0||1.50|
SemGroup presently has a consensus target price of $29.40, suggesting a potential upside of 0.51%. Enbridge Energy Management has a consensus target price of $18.00, suggesting a potential upside of 26.14%. Given Enbridge Energy Management’s higher possible upside, analysts plainly believe Enbridge Energy Management is more favorable than SemGroup.
SemGroup pays an annual dividend of $1.80 per share and has a dividend yield of 6.2%. Enbridge Energy Management pays an annual dividend of $0.55 per share and has a dividend yield of 3.9%. SemGroup pays out -2,250.0% of its earnings in the form of a dividend. Enbridge Energy Management pays out -704.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. SemGroup has increased its dividend for 4 consecutive years. SemGroup is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares SemGroup and Enbridge Energy Management’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|SemGroup||$1.33 billion||1.73||$2.09 million||($0.08)||-365.63|
|Enbridge Energy Management||N/A||N/A||-$120.10 million||($0.08)||-182.78|
SemGroup has higher revenue and earnings than Enbridge Energy Management. SemGroup is trading at a lower price-to-earnings ratio than Enbridge Energy Management, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
98.0% of SemGroup shares are held by institutional investors. Comparatively, 74.6% of Enbridge Energy Management shares are held by institutional investors. 0.8% of SemGroup shares are held by company insiders. Comparatively, 0.3% of Enbridge Energy Management shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Risk & Volatility
SemGroup has a beta of 2.03, suggesting that its stock price is 103% more volatile than the S&P 500. Comparatively, Enbridge Energy Management has a beta of 1.2, suggesting that its stock price is 20% more volatile than the S&P 500.
SemGroup beats Enbridge Energy Management on 12 of the 16 factors compared between the two stocks.
SemGroup Corporation is a provider of gathering, transportation, storage, distribution, marketing and other midstream services to producers, refiners of petroleum products and other market participants located in the Midwest and Rocky Mountain regions of the United States and Canada. The Company’s segments include Crude Transportation, which operates crude oil pipelines and truck transportation businesses in the United States; Crude Facilities, which operates crude oil storage and terminal businesses in the United States; Crude Supply and Logistics, which operates a crude oil marketing business; SemGas, which provides natural gas gathering and processing services; SemCAMS, which operates natural gas processing and gathering facilities in Alberta, Canada; SemLogistics, which owns petroleum products storage facility in the United Kingdom, and SemMexico, which provides liquid asphalt cement products and product application services to the Mexican market, and Corporate and Other.
About Enbridge Energy Management
Enbridge Energy Management, L.L.C. is a limited partner of Enbridge Energy Partners, L.P. (the Partnership). The Company owns i-units, a special class of the Partnership’s limited partner interests. The Company manages the business of the Partnership. The Partnership owns and operates crude oil and liquid petroleum transportation and storage assets, and natural gas gathering, treating, processing, transportation and marketing assets in the United States.
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