Plains Group Holdings, L.P. (NYSE: PAGP) and Columbia Pipeline Partners (NYSE:CPPL) are both oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, risk, dividends, analyst recommendations, earnings and valuation.

Dividends

Plains Group Holdings, L.P. pays an annual dividend of $2.20 per share and has a dividend yield of 9.8%. Columbia Pipeline Partners pays an annual dividend of $0.79 per share and has a dividend yield of 4.6%. Plains Group Holdings, L.P. pays out 333.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Columbia Pipeline Partners pays out 112.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Plains Group Holdings, L.P. has raised its dividend for 2 consecutive years. Plains Group Holdings, L.P. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

83.2% of Plains Group Holdings, L.P. shares are owned by institutional investors. Comparatively, 88.2% of Columbia Pipeline Partners shares are owned by institutional investors. 39.9% of Plains Group Holdings, L.P. shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Plains Group Holdings, L.P. and Columbia Pipeline Partners, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Plains Group Holdings, L.P. 0 9 9 0 2.50
Columbia Pipeline Partners 0 3 0 0 2.00

Plains Group Holdings, L.P. currently has a consensus target price of $27.50, indicating a potential upside of 22.33%. Columbia Pipeline Partners has a consensus target price of $16.58, indicating a potential downside of 3.30%. Given Plains Group Holdings, L.P.’s stronger consensus rating and higher possible upside, equities analysts plainly believe Plains Group Holdings, L.P. is more favorable than Columbia Pipeline Partners.

Profitability

This table compares Plains Group Holdings, L.P. and Columbia Pipeline Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Plains Group Holdings, L.P. 0.34% 0.69% 0.30%
Columbia Pipeline Partners 6.40% 0.92% 0.84%

Earnings & Valuation

This table compares Plains Group Holdings, L.P. and Columbia Pipeline Partners’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Plains Group Holdings, L.P. $23.87 billion 0.14 $1.92 billion $0.66 34.08
Columbia Pipeline Partners N/A N/A N/A $0.70 24.50

Plains Group Holdings, L.P. has higher revenue and earnings than Columbia Pipeline Partners. Columbia Pipeline Partners is trading at a lower price-to-earnings ratio than Plains Group Holdings, L.P., indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Plains Group Holdings, L.P. has a beta of 1.48, indicating that its share price is 48% more volatile than the S&P 500. Comparatively, Columbia Pipeline Partners has a beta of 0.86, indicating that its share price is 14% less volatile than the S&P 500.

Summary

Plains Group Holdings, L.P. beats Columbia Pipeline Partners on 8 of the 14 factors compared between the two stocks.

About Plains Group Holdings, L.P.

Plains GP Holdings, L.P. owns and operates midstream energy infrastructure and provides logistics services for crude oil, natural gas liquids (NGL), natural gas and refined products. The Company operates through three segments: Transportation, Facilities, and Supply and Logistics. Through its three business segments, the Company is engaged in the transportation, storage, terminaling and marketing of crude oil, NGL and natural gas. The Transportation segment operations consist of fee-based activities associated with transporting crude oil and NGL on pipelines, gathering systems, trucks and barges. The Facilities segment operations consist of fee-based activities associated with providing storage, terminaling and throughput services for crude oil, refined products, NGL and natural gas, as well as NGL fractionation and isomerization services and natural gas and condensate processing services. The Supply and Logistics segment operations consist of the merchant-related activities.

About Columbia Pipeline Partners

Columbia Pipeline Partners LP (the Partnership) is a limited partnership company operating a portfolio of pipelines, storage and related midstream assets. It is engaged in interstate gas transportation and storage services for local distribution companies (LDCs), marketers and industrial and commercial customers located in northeastern, mid-Atlantic, Midwestern and southern states, and the District of Columbia along with unregulated businesses that include midstream services, including gathering, treating, conditioning, processing, compression and liquids handling, and development of mineral rights positions. The Company owns, operates and develops a portfolio of pipelines, storage and related midstream assets. The Company has a general partner interest in CPG OpCo LP (Columbia OpCo), as well as a limited partner interest in Columbia OpCo, a limited partnership that owns the natural gas transmission and storage assets of Columbia Energy Group (CEG).

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