Financial Analysis: Southcross Energy Partners (SXE) versus Transportadora de Gas del Sur SA ADR Class B (TGS)
Southcross Energy Partners (NYSE: TGS) and Transportadora de Gas del Sur SA ADR Class B (NYSE:TGS) are both oils/energy companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, valuation, earnings, dividends, analyst recommendations and risk.
Insider and Institutional Ownership
2.9% of Southcross Energy Partners shares are held by institutional investors. Comparatively, 9.4% of Transportadora de Gas del Sur SA ADR Class B shares are held by institutional investors. 23.8% of Southcross Energy Partners shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
This is a summary of current ratings for Southcross Energy Partners and Transportadora de Gas del Sur SA ADR Class B, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Southcross Energy Partners||0||1||0||0||2.00|
|Transportadora de Gas del Sur SA ADR Class B||0||1||1||0||2.50|
Transportadora de Gas del Sur SA ADR Class B has a consensus price target of $25.00, indicating a potential upside of 57.93%. Given Transportadora de Gas del Sur SA ADR Class B’s stronger consensus rating and higher possible upside, analysts clearly believe Transportadora de Gas del Sur SA ADR Class B is more favorable than Southcross Energy Partners.
Valuation and Earnings
This table compares Southcross Energy Partners and Transportadora de Gas del Sur SA ADR Class B’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Southcross Energy Partners||$665.95 million||0.08||-$67.59 million||N/A||N/A|
|Transportadora de Gas del Sur SA ADR Class B||$742.27 million||3.39||$168.71 million||$1.07||14.79|
Transportadora de Gas del Sur SA ADR Class B has higher revenue and earnings than Southcross Energy Partners.
Transportadora de Gas del Sur SA ADR Class B pays an annual dividend of $0.26 per share and has a dividend yield of 1.6%. Southcross Energy Partners does not pay a dividend. Transportadora de Gas del Sur SA ADR Class B pays out 24.3% of its earnings in the form of a dividend. Southcross Energy Partners has increased its dividend for 4 consecutive years.
Volatility & Risk
Southcross Energy Partners has a beta of 4, suggesting that its share price is 300% more volatile than the S&P 500. Comparatively, Transportadora de Gas del Sur SA ADR Class B has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.
This table compares Southcross Energy Partners and Transportadora de Gas del Sur SA ADR Class B’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Southcross Energy Partners||-11.18%||-14.49%||-6.51%|
|Transportadora de Gas del Sur SA ADR Class B||23.69%||70.24%||25.44%|
Transportadora de Gas del Sur SA ADR Class B beats Southcross Energy Partners on 11 of the 15 factors compared between the two stocks.
Southcross Energy Partners Company Profile
Southcross Energy Partners, L.P., together with its subsidiaries, provides natural gas gathering, processing, treating, compression, and transportation services in the United States. The company also offers natural gas liquid (NGL) fractionation and transportation services. In addition, it supplies natural gas to industrial, commercial, and power generation customers, as well as local distribution companies. The company operates 2 gas processing plants, 1 fractionation plant, and gathering and transportation pipelines in South Texas, Mississippi, and Alabama. Southcross Energy Partners GP, LLC operates as a general partner of Southcross Energy Partners, L.P. The company was founded in 2009 and is headquartered in Dallas, Texas. Southcross Energy Partners, L.P. is a subsidiary of Southcross Holdings LP.
Transportadora de Gas del Sur SA ADR Class B Company Profile
Transportadora de Gas del Sur S.A. provides natural gas transportation and distribution services in Argentina. The company operates through four segments: Natural Gas Transportation, Liquids Production and Commercialization, Other Services, and Telecommunications. The Natural Gas Transportation segment transports natural gas through 5,706 miles of pipeline system to distribution companies, power plants, and industrial customers. As of December 31, 2017, it served 6.1 million residential, commercial, industrial, and electric power generation end-users. It also provides operation and maintenance services for the natural gas transportation facilities. The Liquids Production and Commercialization segment produces and commercializes natural gas liquids, such as ethane, LPG, natural gasoline, propane, and butane in Argentina and internationally. The Other Services segment offers midstream services, including natural gas treatment, separation, and removal of impurities from the natural gas stream, as well as natural gas compression. It also provides services related to pipeline and compression plant construction, operation, and maintenance; and generates steam for electricity production. The Telecommunications segment provides telecommunication services for telecommunication operators and corporate customers. Its telecommunication network includes a microwave digital network with synchronous digital hierarchy technology and a dark fiber optic network. The company was founded in 1992 and is headquartered in Buenos Aires, Argentina. Transportadora de Gas del Sur S.A. is a subsidiary of Compañía de Inversiones de Energía S.A.
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