Columbia Pipeline Group (NYSE: CPGX) and Buckeye Partners (NYSE:BPL) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.

Profitability

This table compares Columbia Pipeline Group and Buckeye Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Columbia Pipeline Group 23.76% 7.15% 3.45%
Buckeye Partners 13.13% 10.09% 4.81%

Insider & Institutional Ownership

70.5% of Buckeye Partners shares are held by institutional investors. 0.4% of Buckeye Partners shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for Columbia Pipeline Group and Buckeye Partners, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Columbia Pipeline Group 0 0 0 0 N/A
Buckeye Partners 1 7 2 0 2.10

Buckeye Partners has a consensus target price of $63.30, suggesting a potential upside of 23.80%. Given Buckeye Partners’ higher probable upside, analysts clearly believe Buckeye Partners is more favorable than Columbia Pipeline Group.

Valuation & Earnings

This table compares Columbia Pipeline Group and Buckeye Partners’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Columbia Pipeline Group N/A N/A N/A $0.72 35.40
Buckeye Partners $3.65 billion 2.06 $478.80 million $3.34 15.31

Buckeye Partners has higher revenue and earnings than Columbia Pipeline Group. Buckeye Partners is trading at a lower price-to-earnings ratio than Columbia Pipeline Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Columbia Pipeline Group pays an annual dividend of $0.54 per share and has a dividend yield of 2.1%. Buckeye Partners pays an annual dividend of $5.05 per share and has a dividend yield of 9.9%. Columbia Pipeline Group pays out 75.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Buckeye Partners pays out 151.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Columbia Pipeline Group has increased its dividend for 15 consecutive years and Buckeye Partners has increased its dividend for 2 consecutive years.

Summary

Buckeye Partners beats Columbia Pipeline Group on 9 of the 13 factors compared between the two stocks.

Columbia Pipeline Group Company Profile

Columbia Pipeline Group, Inc. owns, operates and develops a portfolio of pipelines, storage and related midstream assets. The Company is engaged in regulated gas transportation and storage services for local distribution companies (LDCs), marketers, producers, and industrial and commercial customers located in northeastern, mid-Atlantic, Midwestern and southern states and the District of Columbia, along with unregulated businesses that include midstream services, including gathering, treating, conditioning, processing, compression and liquids handling, and development of mineral rights positions. Its segment consists of portfolio of pipelines, storage and related midstream assets. It owns approximately 15,000 miles of strategically located interstate gas pipelines extending from New York to the Gulf of Mexico and an underground natural gas storage system with approximately 300 million dekatherms (MMDth) of working gas capacity, as well as related gathering and processing assets.

Buckeye Partners Company Profile

Buckeye Partners, L.P. (Buckeye) owns and operates a network of integrated assets providing midstream logistic solutions, primarily consisting of the transportation, storage, processing and marketing of liquid petroleum products. Its segments include Domestic Pipelines & Terminals, Global Marine Terminals and Merchant Services. As of December 31, 2016, the Domestic Pipelines & Terminals segment owned and operated approximately 6,000 miles of pipeline located primarily in the northeastern and upper Midwestern portions of the United States, and serviced approximately 110 delivery locations. The Global Marine Terminals segment provides marine accessible bulk storage and blending services, rail and truck rack loading/unloading, along with petroleum processing services in the East Coast and Gulf Coast regions of the United States and in the Caribbean. The Merchant Services segment is a wholesale distributor of petroleum products in the continental United States and in the Caribbean.

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