Contrasting Delek Logistics Partners (DKL) and Noble Midstream Partners (NBLX)

Delek Logistics Partners (NYSE:DKL) and Noble Midstream Partners (NYSE:NBLX) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, dividends, earnings, profitability, valuation, institutional ownership and analyst recommendations.

Dividends

Delek Logistics Partners pays an annual dividend of $3.08 per share and has a dividend yield of 9.9%. Noble Midstream Partners pays an annual dividend of $2.14 per share and has a dividend yield of 5.4%. Delek Logistics Partners pays out 147.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Noble Midstream Partners pays out 52.2% of its earnings in the form of a dividend. Delek Logistics Partners has raised its dividend for 4 consecutive years. Delek Logistics Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Delek Logistics Partners and Noble Midstream Partners’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Delek Logistics Partners $538.08 million 1.45 $69.40 million $2.09 14.95
Noble Midstream Partners $239.28 million 6.53 $140.57 million $4.10 9.61

Noble Midstream Partners has lower revenue, but higher earnings than Delek Logistics Partners. Noble Midstream Partners is trading at a lower price-to-earnings ratio than Delek Logistics Partners, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

22.6% of Delek Logistics Partners shares are owned by institutional investors. Comparatively, 56.4% of Noble Midstream Partners shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Delek Logistics Partners and Noble Midstream Partners, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Delek Logistics Partners 2 1 0 0 1.33
Noble Midstream Partners 0 1 7 0 2.88

Delek Logistics Partners currently has a consensus price target of $31.50, suggesting a potential upside of 0.80%. Noble Midstream Partners has a consensus price target of $55.71, suggesting a potential upside of 41.41%. Given Noble Midstream Partners’ stronger consensus rating and higher possible upside, analysts clearly believe Noble Midstream Partners is more favorable than Delek Logistics Partners.

Profitability

This table compares Delek Logistics Partners and Noble Midstream Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Delek Logistics Partners 13.22% -103.52% 14.92%
Noble Midstream Partners 45.55% 21.14% 13.28%

Volatility & Risk

Delek Logistics Partners has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500. Comparatively, Noble Midstream Partners has a beta of 1.71, meaning that its stock price is 71% more volatile than the S&P 500.

Summary

Noble Midstream Partners beats Delek Logistics Partners on 11 of the 16 factors compared between the two stocks.

Delek Logistics Partners Company Profile

Delek Logistics Partners, LP owns and operates logistics and marketing assets for crude oil, and intermediate and refined products in the United States. It operates in two segments, Pipelines and Transportation, and Wholesale Marketing and Terminalling. The Pipelines and Transportation segment consists of assets, including pipelines and trucks, and ancillary assets that provide crude oil gathering and crude oil, intermediate and finished products transportation, and storage services primarily in support of the Tyler and El Dorado refineries, as well as offers crude oil and other products transportation services to third parties. This segment operates approximately 400 miles of crude oil transportation pipelines; 406 miles of refined product pipelines; and approximately 600 miles of crude oil gathering and trunk lines with an aggregate of approximately 7.3 million barrels of active shell capacity. The Wholesale Marketing and Terminalling segment provides wholesale marketing, transporting, storing, and terminalling services related to refined products to independent third parties. Delek Logistics GP, LLC serves as the general partner of the company. Delek Logistics Partners, LP was founded in 2012 and is headquartered in Brentwood, Tennessee. Delek Logistics Partners, LP operates as a subsidiary of Delek US Holdings, Inc.

Noble Midstream Partners Company Profile

Noble Midstream Partners LP owns, operates, develops, and acquires midstream infrastructure assets in the United States. The company provides crude oil, natural gas, and water-related midstream services. The company operates in the Denver-Julesburg Basin in Colorado and the Delaware Basin in Texas. The company was founded in 2014 and is based in Houston, Texas. Noble Midstream Partners LP is a subsidiary of Noble Energy, Inc.

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