Sprague Resources (NYSE: SRLP) and China Petroleum & Chemical Corporation (NYSE:SNP) are both energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, dividends, analyst recommendations and earnings.

Dividends

Sprague Resources pays an annual dividend of $2.49 per share and has a dividend yield of 10.1%. China Petroleum & Chemical Corporation pays an annual dividend of $3.55 per share and has a dividend yield of 4.9%. Sprague Resources pays out 139.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. China Petroleum & Chemical Corporation pays out 50.7% of its earnings in the form of a dividend. Sprague Resources has increased its dividend for 2 consecutive years. Sprague Resources is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Sprague Resources and China Petroleum & Chemical Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sprague Resources 0 0 2 0 3.00
China Petroleum & Chemical Corporation 0 1 3 0 2.75

Sprague Resources currently has a consensus price target of $33.00, suggesting a potential upside of 33.60%. Given Sprague Resources’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Sprague Resources is more favorable than China Petroleum & Chemical Corporation.

Insider and Institutional Ownership

22.0% of Sprague Resources shares are held by institutional investors. Comparatively, 0.8% of China Petroleum & Chemical Corporation shares are held by institutional investors. 92.2% of China Petroleum & Chemical Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk & Volatility

Sprague Resources has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, China Petroleum & Chemical Corporation has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500.

Valuation and Earnings

This table compares Sprague Resources and China Petroleum & Chemical Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Sprague Resources $2.39 billion 0.23 $10.16 million $1.79 13.80
China Petroleum & Chemical Corporation $290.79 billion 0.30 $7.02 billion $7.00 10.37

China Petroleum & Chemical Corporation has higher revenue and earnings than Sprague Resources. China Petroleum & Chemical Corporation is trading at a lower price-to-earnings ratio than Sprague Resources, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sprague Resources and China Petroleum & Chemical Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sprague Resources 1.50% 24.89% 4.21%
China Petroleum & Chemical Corporation N/A 4.48% 2.54%

Summary

Sprague Resources beats China Petroleum & Chemical Corporation on 9 of the 17 factors compared between the two stocks.

Sprague Resources Company Profile

Sprague Resources LP is engaged in the purchase, storage, distribution and sale of refined products and natural gas, and provides storage and handling services for a range of materials. The Company operates through four segments: refined products, which purchases a range of refined products, such as heating oil, diesel fuel, residual fuel oil, asphalt, kerosene, jet fuel and gasoline from refining companies, trading organizations and producers; natural gas, which purchases natural gas from natural gas producers and trading companies, and sells and distributes natural gas to commercial and industrial customers in the Northeast and Mid-Atlantic United States; materials handling, which offloads, stores and prepares for delivery a range of customer-owned products, including asphalt, clay slurry, coal and heavy equipment, and other operations, which include the purchase and distribution of coal, certain commercial trucking activities and the heating equipment service business.

China Petroleum & Chemical Corporation Company Profile

China Petroleum & Chemical Corporation is a China-based energy and chemical company. The Company’s segments include Exploration and Development segment, Refining segment, Marketing and Distribution segment, Chemicals segment, and Corporate and Others segment. Exploration and Development segment explores and develops oil fields, as well as produces crude oil and natural gas. Refining segment processes and purifies crude oil, which is sourced from Exploration and Development segment and external suppliers. Marketing and Distribution segment owns and operates oil depots and service stations in China. Chemical segment manufactures and sells petrochemical products, derivative petrochemical products and other chemical products to external customers.

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