Energy Transfer Equity (ETE) versus Its Competitors Head-To-Head Review

Energy Transfer Equity (NYSE: ETE) is one of 33 publicly-traded companies in the “Natural gas transmission” industry, but how does it weigh in compared to its competitors? We will compare Energy Transfer Equity to similar businesses based on the strength of its risk, valuation, dividends, profitability, analyst recommendations, institutional ownership and earnings.

Analyst Recommendations

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This is a breakdown of recent recommendations for Energy Transfer Equity and its competitors, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Energy Transfer Equity 0 2 11 0 2.85
Energy Transfer Equity Competitors 358 1482 2044 73 2.46

Energy Transfer Equity currently has a consensus price target of $20.73, suggesting a potential upside of 29.22%. As a group, “Natural gas transmission” companies have a potential upside of 24.60%. Given Energy Transfer Equity’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Energy Transfer Equity is more favorable than its competitors.

Insider and Institutional Ownership

49.1% of Energy Transfer Equity shares are owned by institutional investors. Comparatively, 54.3% of shares of all “Natural gas transmission” companies are owned by institutional investors. 3.3% of Energy Transfer Equity shares are owned by company insiders. Comparatively, 6.9% of shares of all “Natural gas transmission” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Energy Transfer Equity pays an annual dividend of $1.22 per share and has a dividend yield of 7.6%. Energy Transfer Equity pays out 100.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Natural gas transmission” companies pay a dividend yield of 7.0% and pay out 131.5% of their earnings in the form of a dividend. Energy Transfer Equity has raised its dividend for 5 consecutive years. Energy Transfer Equity is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Volatility & Risk

Energy Transfer Equity has a beta of 1.87, suggesting that its share price is 87% more volatile than the S&P 500. Comparatively, Energy Transfer Equity’s competitors have a beta of 1.54, suggesting that their average share price is 54% more volatile than the S&P 500.

Profitability

This table compares Energy Transfer Equity and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Energy Transfer Equity 2.30% 4.48% 1.42%
Energy Transfer Equity Competitors 19.00% 9.07% 4.77%

Earnings and Valuation

This table compares Energy Transfer Equity and its competitors revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Energy Transfer Equity $40.52 billion $915.00 million 13.26
Energy Transfer Equity Competitors $5.37 billion $747.92 million 38.13

Energy Transfer Equity has higher revenue and earnings than its competitors. Energy Transfer Equity is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Summary

Energy Transfer Equity beats its competitors on 8 of the 15 factors compared.

Energy Transfer Equity Company Profile

Energy Transfer Equity, L.P. provides diversified energy-related services in the United States. It owns and operates approximately 7,900 miles of natural gas transportation pipelines and three natural gas storage facilities in Texas; and approximately 11,800 miles of interstate natural gas pipelines. The company sells natural gas to electric utilities, independent power plants, local distribution companies, industrial end-users, and other marketing companies. Its midstream operations include ownership and operation of natural gas and NGL gathering pipelines, natural gas processing plants, natural gas treating facilities, and natural gas conditioning facilities in Texas, New Mexico, West Virginia, Pennsylvania, and Louisiana; natural gas gathering, oil pipeline, and oil stabilization facilities in South Texas; a natural gas gathering system in Ohio; and transportation and supply of water to natural gas producers in Pennsylvania. The company's natural gas liquid (NGL) transportation and services operations include ownership of approximately 1,400 miles of NGL pipelines, five NGL and propane fractionation facilities, and NGL storage facilities. It also 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. In addition, it provides natural gas compression services; treating services, such as 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 a total of 75 megawatts electrical power. The company was founded in 2002 and is based in Dallas, Texas.

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