Head-To-Head Analysis: Andeavor (ANDV) versus Suburban Propane Partners (SPH)

Suburban Propane Partners (NYSE: SPH) and Andeavor (NYSE:ANDV) are both energy companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Risk and Volatility

Suburban Propane Partners has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500. Comparatively, Andeavor has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.

Dividends

Suburban Propane Partners pays an annual dividend of $2.40 per share and has a dividend yield of 9.5%. Andeavor pays an annual dividend of $2.36 per share and has a dividend yield of 2.4%. Suburban Propane Partners pays out 363.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Andeavor pays out 48.4% of its earnings in the form of a dividend.

Profitability

This table compares Suburban Propane Partners and Andeavor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Suburban Propane Partners 9.96% 26.88% 6.76%
Andeavor 2.35% 7.15% 3.11%

Valuation and Earnings

This table compares Suburban Propane Partners and Andeavor’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Suburban Propane Partners $1.19 billion 1.31 $37.99 million $0.66 38.30
Andeavor $24.58 billion 0.63 $734.00 million $4.88 20.21

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

Insider and Institutional Ownership

25.4% of Suburban Propane Partners shares are owned by institutional investors. Comparatively, 79.9% of Andeavor shares are owned by institutional investors. 0.6% of Suburban Propane Partners shares are owned by insiders. Comparatively, 0.9% of Andeavor shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings for Suburban Propane Partners and Andeavor, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Suburban Propane Partners 0 1 2 0 2.67
Andeavor 0 5 12 0 2.71

Suburban Propane Partners presently has a consensus price target of $26.67, suggesting a potential upside of 5.49%. Andeavor has a consensus price target of $126.00, suggesting a potential upside of 27.78%. Given Andeavor’s stronger consensus rating and higher possible upside, analysts clearly believe Andeavor is more favorable than Suburban Propane Partners.

Summary

Andeavor beats Suburban Propane Partners on 10 of the 16 factors compared between the two stocks.

Suburban Propane Partners Company Profile

Suburban Propane Partners, L.P. is a marketer and distributor of a range of products. The Company specializes in the distribution of propane, fuel oil and refined fuels, as well as the marketing of natural gas and electricity in deregulated markets. The Company’s segments include Propane, Fuel Oil and Refined Fuels, Natural Gas and Electricity, and All Other. In support of its marketing and distribution operations, the Company installs and services a range of home comfort equipment, particularly in the areas of heating and ventilation. The Company conducts its business through Suburban Propane, L.P., which operates its propane business and assets (the Operating Partnership), and its direct and indirect subsidiaries. As of September 24, 2016, it had sold approximately 414.8 million gallons of propane and 30.9 million gallons of fuel oil and refined fuels to retail customers. The Company owns and operates a propane storage facility in Elk Grove, California.

Andeavor Company Profile

Andeavor, formerly Tesoro Corporation, is an independent petroleum refining, logistics and marketing company. he Company operates through three segments. The Refining operating segment refines crude oil and other feedstocks into transportation fuels, such as gasoline and gasoline blendstocks, jet fuel and diesel fuel, as well as other products, including heavy fuel oils, liquefied petroleum gas and petroleum coke for sale in bulk markets to a range of customers within its markets. The TLLP segment comprises Tesoro Logistics LP’s (TLLP) assets and operations, and includes certain crude oil and natural gas gathering assets, natural gas and natural gas liquids (NGLs) processing assets, and crude oil and refined products terminaling, and transportation. The marketing segment sells transportation fuels through branded and unbranded channels.

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