Tesoro Corporation (NYSE: ANDV) and Western Gas Equity Partners, (NYSE:WGP) are both mid-cap oils/energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, risk, dividends, institutional ownership and profitability.

Risk & Volatility

Tesoro Corporation has a beta of 1.71, suggesting that its stock price is 71% more volatile than the S&P 500. Comparatively, Western Gas Equity Partners, has a beta of 1.56, suggesting that its stock price is 56% more volatile than the S&P 500.

Profitability

This table compares Tesoro Corporation and Western Gas Equity Partners,’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tesoro Corporation 1.22% 5.24% 2.27%
Western Gas Equity Partners, 17.50% 8.78% 4.69%

Dividends

Tesoro Corporation pays an annual dividend of $2.20 per share and has a dividend yield of 2.2%. Western Gas Equity Partners, pays an annual dividend of $2.11 per share and has a dividend yield of 5.3%. Tesoro Corporation pays out 78.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Gas Equity Partners, pays out 129.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Gas Equity Partners, has increased its dividend for 3 consecutive years. Western Gas Equity Partners, is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

77.5% of Tesoro Corporation shares are held by institutional investors. Comparatively, 17.8% of Western Gas Equity Partners, shares are held by institutional investors. 0.9% of Tesoro Corporation shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Tesoro Corporation and Western Gas Equity Partners,, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tesoro Corporation 0 3 14 0 2.82
Western Gas Equity Partners, 0 2 6 0 2.75

Tesoro Corporation currently has a consensus price target of $109.13, suggesting a potential upside of 10.74%. Western Gas Equity Partners, has a consensus price target of $51.25, suggesting a potential upside of 28.41%. Given Western Gas Equity Partners,’s higher probable upside, analysts plainly believe Western Gas Equity Partners, is more favorable than Tesoro Corporation.

Earnings & Valuation

This table compares Tesoro Corporation and Western Gas Equity Partners,’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Tesoro Corporation N/A N/A N/A $2.81 35.07
Western Gas Equity Partners, $2.03 billion 4.30 $944.00 million $1.63 24.48

Western Gas Equity Partners, has higher revenue and earnings than Tesoro Corporation. Western Gas Equity Partners, is trading at a lower price-to-earnings ratio than Tesoro Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Western Gas Equity Partners, beats Tesoro Corporation on 8 of the 15 factors compared between the two stocks.

About Tesoro Corporation

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.

About Western Gas Equity Partners,

Western Gas Equity Partners, LP is a limited partnership. The Company is formed to own approximately three types of partnership interests in Western Gas Partners, LP (WES). WES is an master limited partnership (MLP) engaged in the business of gathering, compressing, treating, processing and transporting natural gas, and gathering, stabilizing and transporting condensate, natural gas liquids (NGLs) and crude oil. WES provides these midstream services for Anadarko Petroleum Corporation (Anadarko), as well as for third-party producers and customers. Its assets and investments are located in the Rocky Mountains (Colorado, Utah and Wyoming), North-central Pennsylvania and Texas. The Bison treating facility treats and compresses gas from coal-bed methane wells in the Powder River Basin of Wyoming. MIGC, LLC receives gas from various coal-bed methane gathering systems in the Powder River Basin and the Hilight system, as well as from WBI Energy Transmission, Inc.

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