Pembina Pipeline (NYSE:PBA – Get Free Report) and Anadarko Petroleum (NASDAQ:APC – Get Free Report) are both energy companies, but which is the better stock? We will compare the two companies based on the strength of their risk, dividends, institutional ownership, earnings, analyst recommendations, profitability and valuation.
Institutional and Insider Ownership
55.4% of Pembina Pipeline shares are owned by institutional investors. 0.1% of Pembina Pipeline shares are owned by insiders. Comparatively, 0.5% of Anadarko Petroleum shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Analyst Ratings
This is a summary of current ratings for Pembina Pipeline and Anadarko Petroleum, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Pembina Pipeline | 0 | 5 | 5 | 0 | 2.50 |
| Anadarko Petroleum | 2 | 0 | 4 | 1 | 2.57 |
Pembina Pipeline currently has a consensus price target of $64.00, indicating a potential upside of 27.16%. Anadarko Petroleum has a consensus price target of $21.40, indicating a potential upside of 48.20%. Given Anadarko Petroleum’s stronger consensus rating and higher probable upside, analysts plainly believe Anadarko Petroleum is more favorable than Pembina Pipeline.
Profitability
This table compares Pembina Pipeline and Anadarko Petroleum’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Pembina Pipeline | 24.77% | 12.60% | 5.32% |
| Anadarko Petroleum | 0.65% | 21.23% | 3.06% |
Dividends
Pembina Pipeline pays an annual dividend of $2.12 per share and has a dividend yield of 4.2%. Anadarko Petroleum pays an annual dividend of $2.00 per share and has a dividend yield of 13.9%. Pembina Pipeline pays out 88.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Anadarko Petroleum pays out 206.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pembina Pipeline has increased its dividend for 4 consecutive years.
Valuation and Earnings
This table compares Pembina Pipeline and Anadarko Petroleum”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Pembina Pipeline | $5.57 billion | 5.26 | $1.21 billion | $2.39 | 21.06 |
| Anadarko Petroleum | $5.58 billion | 0.03 | $32.73 million | $0.97 | 14.89 |
Pembina Pipeline has higher earnings, but lower revenue than Anadarko Petroleum. Anadarko Petroleum is trading at a lower price-to-earnings ratio than Pembina Pipeline, indicating that it is currently the more affordable of the two stocks.
Summary
Pembina Pipeline beats Anadarko Petroleum on 10 of the 17 factors compared between the two stocks.
About Pembina Pipeline
Pembina Pipeline Corporation is a Canadian energy transportation and midstream services company headquartered in Calgary, Alberta. Founded in 1954, it began as a pipeline operator serving oil fields in Alberta and has expanded into a range of energy infrastructure businesses. The company transports crude oil, natural gas and natural gas liquids through its pipeline networks. Its operations also include natural gas gathering and processing, liquids fractionation, storage and terminalling, along with services that help connect producers with domestic and export markets.
About Anadarko Petroleum
Anadarko Petroleum Corporation was an independent oil and natural gas exploration and production company. Its business focused on finding, developing and producing crude oil, natural gas and natural gas liquids. The company operated across several U.S. regions and held international exploration and production interests, including in Africa. Its portfolio included both onshore and offshore properties. Headquartered in The Woodlands, Texas, Anadarko was led by Chairman and Chief Executive Officer Al Walker during its final years as an independent company.
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