Energy Transfer (NYSE:ET) vs. Equitrans Midstream (NYSE:ETRN) Critical Comparison

Energy Transfer (NYSE:ET) and Equitrans Midstream (NYSE:ETRN) are both oils/energy companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, analyst recommendations, profitability, valuation, earnings and risk.

Insider and Institutional Ownership

39.8% of Energy Transfer shares are held by institutional investors. Comparatively, 94.7% of Equitrans Midstream shares are held by institutional investors. 3.3% of Energy Transfer shares are held by company insiders. Comparatively, 0.5% of Equitrans Midstream shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Energy Transfer and Equitrans Midstream’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Energy Transfer 2.90% 8.64% 2.97%
Equitrans Midstream -12.80% 15.32% 6.16%

Analyst Ratings

This is a breakdown of current ratings for Energy Transfer and Equitrans Midstream, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Energy Transfer 0 7 7 1 2.60
Equitrans Midstream 0 1 0 0 2.00

Energy Transfer currently has a consensus price target of $10.00, suggesting a potential upside of 66.11%. Equitrans Midstream has a consensus price target of $10.00, suggesting a potential upside of 23.15%. Given Energy Transfer’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Energy Transfer is more favorable than Equitrans Midstream.

Valuation and Earnings

This table compares Energy Transfer and Equitrans Midstream’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Energy Transfer $54.21 billion 0.30 $3.59 billion $1.45 4.15
Equitrans Midstream $1.63 billion 2.15 -$203.74 million $3.00 2.71

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

Risk and Volatility

Energy Transfer has a beta of 2.56, indicating that its share price is 156% more volatile than the S&P 500. Comparatively, Equitrans Midstream has a beta of 2.3, indicating that its share price is 130% more volatile than the S&P 500.

Dividends

Energy Transfer pays an annual dividend of $1.22 per share and has a dividend yield of 20.3%. Equitrans Midstream pays an annual dividend of $0.60 per share and has a dividend yield of 7.4%. Energy Transfer pays out 84.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Equitrans Midstream pays out 20.0% of its earnings in the form of a dividend. Energy Transfer has raised its dividend for 1 consecutive years and Equitrans Midstream has raised its dividend for 1 consecutive years.

Summary

Energy Transfer beats Equitrans Midstream on 11 of the 17 factors compared between the two stocks.

Energy Transfer Company Profile

Energy Transfer LP provides energy-related services. The company owns and operates approximately 9,400 miles of natural gas transportation pipelines and three natural gas storage facilities in Texas; and 12,500 miles of interstate natural gas pipelines. It sells natural gas to electric utilities, independent power plants, local distribution companies, industrial end-users, and other marketing companies. The company also owns and operates natural gas gathering and natural gas liquid (NGL) pipelines, processing plants, and treating and conditioning facilities in Texas, New Mexico, West Virginia, Pennsylvania, Ohio, Oklahoma, Kansas, and Louisiana; natural gas gathering, oil pipeline, and oil stabilization facilities in South Texas; and a natural gas gathering system in Ohio, as well as transports and supplies water to natural gas producers in Pennsylvania. In addition, it owns approximately 4,515 miles of NGL pipelines; NGL and propane fractionation facilities; NGL storage facilities with working storage capacity of approximately 50 million barrels (MMBbls); and other NGL storage assets and terminals with an aggregate storage capacity of approximately 13 MMBbls. Further, the company sells gasoline, middle distillates, and motor fuel at retail, as well as crude oil, NGLs, and refined products; operates convenience stores; and distributes motor fuels and other petroleum products. Additionally, it provides natural gas compression services; carbon dioxide and hydrogen sulfide removal, natural gas cooling, dehydration, and British thermal unit management services; and manages coal and natural resources properties, as well as sells standing timber, leases coal-related infrastructure facilities, collects oil and gas royalties, and generates electrical power. The company was formerly known as Energy Transfer Equity, L.P. and changed its name to Energy Transfer LP in October 2018. Energy Transfer LP was founded in 2002 and is headquartered in Dallas, Texas.

Equitrans Midstream Company Profile

Equitrans Midstream Corporation owns, operates, acquires, and develops natural gas gathering, transmission and storage, and water services assets in the Appalachian Basin. It operates through three segments: Gathering, Transmission, and Water. The Gathering System segment include 990 miles of high-pressure gathering lines with compression of approximately 445,000 horsepower and multiple interconnect points; and approximately 920 miles of Federal Energy Regulatory Commission (FERC) low-pressure gathering lines. Its Transmission and Storage System segment comprises 950 miles of FERC regulated interstate pipeline that connects to seven interstate pipelines and local distribution companies. The Water System segment include two independent systems comprised approximately 180 miles of pipeline that deliver fresh water from the Monongahela River, the Ohio River, local reservoirs, and various regional waterways. Equitrans Midstream Corporation was founded in 2018 and is headquartered in Canonsburg, Pennsylvania.

Receive News & Ratings for Energy Transfer Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Energy Transfer and related companies with MarketBeat.com's FREE daily email newsletter.