Northern Tier Energy (NYSE: NTI) and Alon USA Energy (NYSE:ALJ) are both energy companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, profitability, earnings, dividends, valuation, risk and analyst recommendations.

Earnings & Valuation

This table compares Northern Tier Energy and Alon USA Energy’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Northern Tier Energy N/A N/A N/A N/A N/A
Alon USA Energy N/A N/A N/A ($0.56) -23.79

Profitability

This table compares Northern Tier Energy and Alon USA Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Northern Tier Energy 1.69% 12.03% 4.34%
Alon USA Energy 0.89% 5.65% 1.96%

Insider & Institutional Ownership

49.5% of Alon USA Energy shares are held by institutional investors. 8.8% of Alon USA Energy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Alon USA Energy pays an annual dividend of $0.60 per share and has a dividend yield of 4.5%. Northern Tier Energy does not pay a dividend. Alon USA Energy pays out -107.1% of its earnings in the form of a dividend. Northern Tier Energy has raised its dividend for 2 consecutive years and Alon USA Energy has raised its dividend for 4 consecutive years.

Analyst Ratings

This is a summary of recent ratings and price targets for Northern Tier Energy and Alon USA Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Northern Tier Energy 0 0 0 0 N/A
Alon USA Energy 0 3 1 0 2.25

Alon USA Energy has a consensus target price of $11.38, suggesting a potential downside of 14.60%. Given Alon USA Energy’s higher possible upside, analysts clearly believe Alon USA Energy is more favorable than Northern Tier Energy.

Summary

Alon USA Energy beats Northern Tier Energy on 7 of the 10 factors compared between the two stocks.

About Northern Tier Energy

Northern Tier Energy LP is a downstream energy limited partnership. The Company has refining, retail and logistics operations that serve the Petroleum Administration for Defense District II (PADD II) region of the United States. It operates through two segments: the refining business and the retail business. Its refining segment consists of over 97,800 barrels per stream day refinery located in St. Paul Park, Minnesota. Its refineries process light, heavy, sweet and sour crudes into refined products. It also owns storage and transportation assets. The retail segment operates over 170 convenience stores and supports over 110 franchised convenience stores, which are operated under the SuperAmerica brand. These convenience stores are located throughout Minnesota, Wisconsin and South Dakota and sell various grades of gasoline and diesel, tobacco products and immediately consumable items, such as beverages, prepared food and a range of snacks and prepackaged items.

About Alon USA Energy

Alon USA Energy, Inc. is an independent refiner and marketer of petroleum products, operating primarily in the South Central, Southwestern and Western regions of the United States. The Company’s segments include refining and marketing, asphalt and retail. Its refineries produce petroleum products, including various grades of gasoline, diesel, jet fuel, petrochemicals, petrochemical feedstocks, asphalt, and other petroleum-based products. As of December 31, 2016, it held interests in Alon USA Partners, LP, which owned a crude oil refinery in Big Spring, Texas, with a crude oil throughput capacity of 73,000 barrels per day and an integrated wholesale marketing business. In addition, it owned a crude oil refinery in Krotz Springs, Louisiana, with a crude oil throughput capacity of approximately 74,000 barrels per day (bpd), as of December 31, 2016. The Company also owns crude oil refineries in California. As of December 31, 2016, it operated approximately 300 convenience stores.

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