Financial Analysis: EnLink Midstream (ENLC) versus Tallgrass Energy GP, (TEGP)
EnLink Midstream (NYSE: ENLC) and Tallgrass Energy GP, (NYSE:TEGP) are both oils/energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, analyst recommendations, institutional ownership and earnings.
Insider and Institutional Ownership
34.8% of EnLink Midstream shares are held by institutional investors. Comparatively, 99.7% of Tallgrass Energy GP, shares are held by institutional investors. 1.2% of EnLink Midstream shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
EnLink Midstream pays an annual dividend of $1.02 per share and has a dividend yield of 5.8%. Tallgrass Energy GP, pays an annual dividend of $1.37 per share and has a dividend yield of 5.2%. Tallgrass Energy GP, pays out 201.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tallgrass Energy GP, has increased its dividend for 2 consecutive years.
This is a summary of recent recommendations and price targets for EnLink Midstream and Tallgrass Energy GP,, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Tallgrass Energy GP,||1||5||3||0||2.22|
EnLink Midstream presently has a consensus target price of $18.33, suggesting a potential upside of 4.17%. Tallgrass Energy GP, has a consensus target price of $30.00, suggesting a potential upside of 13.81%. Given Tallgrass Energy GP,’s stronger consensus rating and higher probable upside, analysts plainly believe Tallgrass Energy GP, is more favorable than EnLink Midstream.
This table compares EnLink Midstream and Tallgrass Energy GP,’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Tallgrass Energy GP,||5.91%||2.01%||0.96%|
Earnings and Valuation
This table compares EnLink Midstream and Tallgrass Energy GP,’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|EnLink Midstream||$4.92 billion||0.65||$751.90 million||N/A||N/A|
|Tallgrass Energy GP,||$614.20 million||2.49||$349.34 million||$0.68||38.76|
EnLink Midstream has higher revenue and earnings than Tallgrass Energy GP,.
Volatility & Risk
EnLink Midstream has a beta of 2.62, suggesting that its stock price is 162% more volatile than the S&P 500. Comparatively, Tallgrass Energy GP, has a beta of 2.16, suggesting that its stock price is 116% more volatile than the S&P 500.
Tallgrass Energy GP, beats EnLink Midstream on 9 of the 15 factors compared between the two stocks.
About EnLink Midstream
EnLink Midstream, LLC is an integrated midstream company. The Company’s assets consist of equity interests in EnLink Midstream Partners, LP (the Partnership) and EnLink Oklahoma Gas Processing, LP (EnLink Oklahoma T.O.). The Partnership is engaged in the gathering, transmission, processing and marketing of natural gas and natural gas liquids (NGLs), condensate and crude oil, as well as providing crude oil, condensate and brine services to producers. EnLink Oklahoma T.O., a partnership owned by the Partnership and the Company, is engaged in the gathering and processing of natural gas. The Partnership’s segments include Texas, Oklahoma, Louisiana, Crude and Condensate, and Corporate. The Partnership connects the wells of producers in its market areas to its gathering systems, processes natural gas to remove NGLs, fractionates NGLs into purity products and markets those products for a fee, transports natural gas and provides natural gas to a range of markets.
About Tallgrass Energy GP,
Tallgrass Energy GP, LP is a limited partnership company, which includes the operations of Tallgrass Equity, LLC (Tallgrass Equity), Tallgrass MLP GP, LLC, Tallgrass Energy Partners, LP (TEP), and TEP’s subsidiaries. TEP owns, operates, acquires and develops midstream energy assets in North America. TEP’s segments include Crude Oil Transportation & Logistics, which is engaged in the ownership and operation of a crude oil pipeline system, and crude oil storage and terminaling facilities; Natural Gas Transportation & Logistics, which is engaged in the ownership and operation of interstate natural gas pipelines and integrated natural gas storage facilities; Processing & Logistics, which is engaged in the ownership and operation of natural gas processing, treating and fractionation facilities, and the provision of water business services to the oil and gas exploration and production industry, and Corporate and Other.
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