Enterprise GP (NYSE: QEP) and QEP Resources (NYSE:QEP) are both oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, analyst recommendations, profitability, institutional ownership and earnings.

Institutional & Insider Ownership

66.5% of Enterprise GP shares are held by institutional investors. Comparatively, 99.2% of QEP Resources shares are held by institutional investors. 0.4% of Enterprise GP shares are held by company insiders. Comparatively, 1.6% of QEP Resources shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Enterprise GP and QEP Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Enterprise GP -18.51% -16.50% -1.36%
QEP Resources -13.63% 5.96% 2.91%

Volatility and Risk

Enterprise GP has a beta of 3.66, suggesting that its share price is 266% more volatile than the S&P 500. Comparatively, QEP Resources has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Enterprise GP and QEP Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Enterprise GP 3 7 1 0 1.82
QEP Resources 1 8 5 0 2.29

Enterprise GP presently has a consensus target price of $2.65, indicating a potential upside of 38.02%. QEP Resources has a consensus target price of $13.40, indicating a potential upside of 26.21%. Given Enterprise GP’s higher possible upside, equities research analysts plainly believe Enterprise GP is more favorable than QEP Resources.

Earnings & Valuation

This table compares Enterprise GP and QEP Resources’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Enterprise GP $1.07 billion 0.46 -$194.00 million ($0.39) -4.92
QEP Resources $1.62 billion 1.55 $269.30 million $0.77 13.79

QEP Resources has higher revenue and earnings than Enterprise GP. Enterprise GP is trading at a lower price-to-earnings ratio than QEP Resources, indicating that it is currently the more affordable of the two stocks.

Summary

QEP Resources beats Enterprise GP on 12 of the 14 factors compared between the two stocks.

About Enterprise GP

EP Energy Corporation, an independent exploration and production company, engages in the exploration for and the acquisition, development, and production of oil, natural gas, and natural gas liquids in the United States. The company has interests in three primary areas, such as the Permian basin in West Texas; the Eagle Ford Shale in South Texas; and the Altamont Field in the Uinta basin in Northeastern Utah. As of December 31, 2017, it had proved reserves of 392.1 million barrels of oil equivalent and had average net daily production of 82,257 barrel of oil equivalent/per day. The company primarily sells its oil and natural gas production to third parties. EP Energy Corporation was founded in 2013 and is headquartered in Houston, Texas.

About QEP Resources

QEP Resources, Inc., through its subsidiaries, operates as a natural gas and crude oil exploration and production company in the United States. The company conducts exploration and production activities in the Permian Basin in western Texas, Williston Basin in North Dakota, Haynesville/Cotton Valley in northwestern Louisiana, Uinta Basin in eastern Utah, and other proven properties in Wyoming, Utah, and Colorado. As of December 31, 2017, it had estimated proved reserves of 684.7 MMboe. The company sells its gas, oil, and natural gas liquids (NGL) to various customers, including wholesale marketers, industrial users, local distribution companies, utilities, and other companies. In addition, it operates an underground gas storage facility. QEP Resources, Inc. is headquartered in Denver, Colorado.

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