Analyzing Hess Midstream Partners (NYSE:HESM) & Gran Tierra Energy (NYSE:GTE)

Hess Midstream Partners (NYSE:HESM) and Gran Tierra Energy (NYSE:GTE) are both energy companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, earnings, analyst recommendations, profitability and risk.

Analyst Recommendations

This is a summary of recent ratings for Hess Midstream Partners and Gran Tierra Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hess Midstream Partners	3	5	1	0	1.78
Gran Tierra Energy	0	0	2	1	3.33

Hess Midstream Partners presently has a consensus target price of $33.25, suggesting a potential upside of 7.54%. Gran Tierra Energy has a consensus target price of $9.72, suggesting a potential upside of 4.63%. Given Hess Midstream Partners’ higher probable upside, equities research analysts clearly believe Hess Midstream Partners is more favorable than Gran Tierra Energy.

Volatility and Risk

Hess Midstream Partners has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500. Comparatively, Gran Tierra Energy has a beta of 0.25, meaning that its stock price is 75% less volatile than the S&P 500.

Profitability

This table compares Hess Midstream Partners and Gran Tierra Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hess Midstream Partners	23.49%	93.86%	8.78%
Gran Tierra Energy	7.17%	11.36%	3.28%

Institutional and Insider Ownership

99.0% of Hess Midstream Partners shares are owned by institutional investors. Comparatively, 31.7% of Gran Tierra Energy shares are owned by institutional investors. 5.8% of Gran Tierra Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Hess Midstream Partners and Gran Tierra Energy”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hess Midstream Partners	$1.62 billion	3.93	$352.90 million	$2.92	10.59
Gran Tierra Energy	$657.47 million	0.50	-$6.29 million	($7.88)	-1.18

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

Summary

Hess Midstream Partners beats Gran Tierra Energy on 11 of the 15 factors compared between the two stocks.

About Hess Midstream Partners

Hess Midstream LP owns and operates midstream infrastructure that gathers, processes, transports and stores crude oil, natural gas and natural gas liquids produced in the Bakken and Three Forks formations. Its services support oil and gas production in the Williston Basin of North Dakota. The company’s assets include crude oil and natural gas gathering systems, natural gas compression and processing facilities, and infrastructure for transporting and handling natural gas liquids. It also provides water gathering and disposal services used in oil and gas operations.

About Gran Tierra Energy

Gran Tierra Energy Inc. is an independent energy company focused on exploring for, developing and producing oil and natural gas. Its operations include producing fields as well as exploration prospects, with crude oil as a key product. Founded in 2005 and based in Calgary, Alberta, the company has built a portfolio spanning Colombia, Ecuador and Canada. Its activities include operating and developing oil and gas assets and pursuing exploration opportunities in these markets.