Critical Survey: Plains All American Pipeline (NASDAQ:PAA) versus Birchcliff Energy (OTCMKTS:BIREF)

Plains All American Pipeline (NASDAQ:PAA) and Birchcliff Energy (OTCMKTS:BIREF) are both energy companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, institutional ownership, dividends, profitability, earnings and risk.

Volatility and Risk

Plains All American Pipeline has a beta of 0.57, indicating that its share price is 43% less volatile than the S&P 500. Comparatively, Birchcliff Energy has a beta of 0.31, indicating that its share price is 69% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Plains All American Pipeline and Birchcliff Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Plains All American Pipeline	2	7	8	1	2.44
Birchcliff Energy	0	4	0	0	2.00

Plains All American Pipeline currently has a consensus target price of $25.73, suggesting a potential upside of 3.02%. Given Plains All American Pipeline’s stronger consensus rating and higher possible upside, equities analysts clearly believe Plains All American Pipeline is more favorable than Birchcliff Energy.

Insider and Institutional Ownership

41.8% of Plains All American Pipeline shares are owned by institutional investors. Comparatively, 0.8% of Birchcliff Energy shares are owned by institutional investors. 1.1% of Plains All American Pipeline shares are owned by company insiders. Comparatively, 1.5% of Birchcliff Energy shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Plains All American Pipeline pays an annual dividend of $1.67 per share and has a dividend yield of 6.7%. Birchcliff Energy pays an annual dividend of $0.08 per share and has a dividend yield of 1.7%. Plains All American Pipeline pays out 46.3% of its earnings in the form of a dividend. Birchcliff Energy pays out 32.0% 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. Plains All American Pipeline has increased its dividend for 5 consecutive years. Plains All American Pipeline is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Plains All American Pipeline and Birchcliff Energy”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Plains All American Pipeline	$44.26 billion	0.40	$1.44 billion	$3.61	6.92
Birchcliff Energy	$508.03 million	2.50	$46.43 million	$0.25	18.52

Plains All American Pipeline has higher revenue and earnings than Birchcliff Energy. Plains All American Pipeline is trading at a lower price-to-earnings ratio than Birchcliff Energy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Plains All American Pipeline and Birchcliff Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Plains All American Pipeline	5.29%	12.13%	4.59%
Birchcliff Energy	12.93%	4.23%	2.77%

Summary

Plains All American Pipeline beats Birchcliff Energy on 13 of the 18 factors compared between the two stocks.

About Plains All American Pipeline

Plains All American Pipeline, L.P., through its subsidiaries, engages in the pipeline transportation, terminalling, storage, and gathering of crude oil and natural gas liquids (NGL) in the United States and Canada. The company operates in two segments, Crude Oil and NGL. The Crude Oil segment offers gathering and transporting crude oil through pipelines, gathering systems, trucks, and at times on barges or railcars. This segment provides terminalling, storage, and other facilities-related services, as well as merchant activities. As of December 31, 2021, this segment owned and leased 18,300 miles of active crude oil transportation pipelines and gathering systems, as well as an additional 110 miles of pipelines that supports crude oil storage and terminalling facilities; 74 million barrels of commercial crude oil storage capacity; 38 million barrels of active, above-ground tank capacity; four marine facilities; a condensate processing facility; seven crude oil rail terminals and 2,100 crude oil railcars; and 640 trucks and 1,275 trailers. The Natural Gas Liquids segment engages in the natural gas processing, NGL fractionation, storage, transportation, and terminalling activities. As of December 31, 2021, this segment owned and operated four natural gas processing plants; nine fractionation plants; 28 million barrels of NGL storage capacity; approximately 1,620 miles of active NGL transportation pipelines, as well as an additional 55 miles of pipeline that supports NGL storage facilities; 16 NGL rail terminals and approximately 3,900 NGL rail cars; and approximately 220 trailers. The company was founded in 1981 and is headquartered in Houston, Texas.

About Birchcliff Energy

Birchcliff Energy Ltd., an intermediate oil and natural gas company, explores for, develops, and produces natural gas, light oil, condensate, and other natural gas liquids in Western Canada. The company holds interests in the areas of Montney/Doig Resource Play, including the Pouce Coupe and Gordondale properties in Alberta. Birchcliff Energy Ltd. was founded in 2004 and is headquartered in Calgary, Canada.