Tesoro Corporation (ANDV) versus Crestwood Equity Partners (CEQP) Critical Review
Tesoro Corporation (NYSE: ANDV) and Crestwood Equity Partners (NYSE:CEQP) are both oils/energy companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, earnings, institutional ownership, dividends, valuation, analyst recommendations and risk.
Insider & Institutional Ownership
77.5% of Tesoro Corporation shares are owned by institutional investors. Comparatively, 65.2% of Crestwood Equity Partners shares are owned by institutional investors. 0.9% of Tesoro Corporation shares are owned by company insiders. Comparatively, 36.2% of Crestwood Equity Partners shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
This is a breakdown of current ratings and recommmendations for Tesoro Corporation and Crestwood Equity Partners, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Crestwood Equity Partners||0||0||4||0||3.00|
Tesoro Corporation presently has a consensus target price of $109.14, indicating a potential upside of 2.56%. Crestwood Equity Partners has a consensus target price of $28.00, indicating a potential upside of 14.05%. Given Crestwood Equity Partners’ stronger consensus rating and higher probable upside, analysts plainly believe Crestwood Equity Partners is more favorable than Tesoro Corporation.
This table compares Tesoro Corporation and Crestwood Equity Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Crestwood Equity Partners||-4.68%||-1.13%||-0.49%|
Earnings & Valuation
This table compares Tesoro Corporation and Crestwood Equity Partners’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Crestwood Equity Partners||$3.06 billion||0.56||$311.60 million||($2.24)||-10.96|
Crestwood Equity Partners has higher revenue and earnings than Tesoro Corporation. Crestwood 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.
Tesoro Corporation pays an annual dividend of $2.36 per share and has a dividend yield of 2.2%. Crestwood Equity Partners pays an annual dividend of $2.40 per share and has a dividend yield of 9.8%. Tesoro Corporation pays out 84.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Crestwood Equity Partners pays out -107.1% of its earnings in the form of a dividend. Crestwood Equity Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.
Volatility & Risk
Tesoro Corporation has a beta of 1.61, meaning that its stock price is 61% more volatile than the S&P 500. Comparatively, Crestwood Equity Partners has a beta of 2.65, meaning that its stock price is 165% more volatile than the S&P 500.
Crestwood Equity Partners beats Tesoro Corporation on 7 of the 13 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 Crestwood Equity Partners
Crestwood Equity Partners LP is a holding company and a master limited partnership (MLP). The Company develops, acquires, owns or controls, and operates assets and operations within the energy midstream sector. The Company’s segments include gathering and processing (G&P), which includes its natural gas, crude oil and produced water G&P operations; storage and transportation, which includes its natural gas and crude oil storage and transportation operations, and marketing, supply and logistics, which includes its natural gas liquid (NGL) supply and logistics business, crude oil storage and rail loading facilities and fleet, and salt production business. The Company provides infrastructure solutions to service natural gas and crude oil shale plays across the United States. It owns and operates a portfolio of crude oil and natural gas gathering, processing, storage and transportation assets. Its operating assets are owned by or through its subsidiary, Crestwood Midstream Partners LP.
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