Cone Midstream Partners (NYSE: CNNX) and Oneok Partners (NYSE:OKS) are both oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, earnings, risk and analyst recommendations.

Dividends

Cone Midstream Partners pays an annual dividend of $1.17 per share and has a dividend yield of 6.7%. Oneok Partners pays an annual dividend of $3.16 per share and has a dividend yield of 6.2%. Cone Midstream Partners pays out 70.1% of its earnings in the form of a dividend. Oneok Partners pays out 137.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cone Midstream Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Cone Midstream Partners and Oneok Partners’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Cone Midstream Partners $234.05 million 4.77 $150.90 million $1.67 10.50
Oneok Partners N/A N/A N/A $2.30 22.20

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

Analyst Ratings

This is a summary of recent recommendations for Cone Midstream Partners and Oneok Partners, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cone Midstream Partners 0 5 4 0 2.44
Oneok Partners 0 11 2 0 2.15

Cone Midstream Partners presently has a consensus price target of $23.00, indicating a potential upside of 31.13%. Oneok Partners has a consensus price target of $47.09, indicating a potential downside of 7.79%. Given Cone Midstream Partners’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Cone Midstream Partners is more favorable than Oneok Partners.

Profitability

This table compares Cone Midstream Partners and Oneok Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cone Midstream Partners 45.95% 14.15% 11.74%
Oneok Partners 9.82% 11.31% 7.03%

Institutional & Insider Ownership

37.0% of Cone Midstream Partners shares are held by institutional investors. Comparatively, 41.2% of Oneok Partners shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Volatility and Risk

Cone Midstream Partners has a beta of 1.68, meaning that its share price is 68% more volatile than the S&P 500. Comparatively, Oneok Partners has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500.

Summary

Cone Midstream Partners beats Oneok Partners on 10 of the 12 factors compared between the two stocks.

About Cone Midstream Partners

CONE Midstream Partners LP is a master limited partnership formed by CONSOL Energy Inc. (CONSOL) and Noble Energy, Inc. (Noble Energy). The Company owns, operates, develops and acquires natural gas gathering and other midstream energy assets to service CONSOL’s and Noble Energy’s production in the Marcellus Shale in Pennsylvania and West Virginia. Its assets include natural gas gathering pipelines and compression and dehydration facilities, as well as condensate gathering, collection, separation and stabilization facilities. It operates through three segments: Anchor Systems, Growth Systems and Additional Systems. Its Anchor Systems include developed midstream systems, including its three midstream systems (the McQuay System, the Majorsville System and the Mamont System) and related assets. Its Growth Systems are located in the dry gas regions of its dedicated acreage. Its Additional Systems include various gathering systems located in the wet gas regions of its dedicated acreage.

About Oneok Partners

ONEOK Partners, L.P. is engaged in gathering, processing, storage and transportation of natural gas in the United States. In addition, the Company owns natural gas liquids (NGL) systems, connecting NGL supply in the Mid-Continent, Permian and Rocky Mountain regions. It operates through three segments: Natural Gas Gathering and Processing, Natural Gas Liquids, and Natural Gas Pipelines. The Natural Gas Gathering and Processing segment provides midstream services to contracted producers in North Dakota, Montana, Wyoming, Kansas and Oklahoma. Its Natural Gas Liquids segment owned and operated facilities that gathered, fractionated, treated and distributed NGLs and store NGL products, in Oklahoma, Kansas, Texas, New Mexico and the Rocky Mountain region where it provided midstream services to producers of NGLs and delivered those products to the two primary market centers, one in the Mid-Continent in Conway, and the other in the Gulf Coast in Mont Belvieu, Texas, as of December 31, 2016.

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