Archrock Partners (NASDAQ:APLP) and Southcross Energy Partners (NYSE:SXE) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Dividends

Archrock Partners pays an annual dividend of $1.14 per share and has a dividend yield of 7.5%. Southcross Energy Partners does not pay a dividend. Archrock Partners pays out 422.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Southcross Energy Partners has raised its dividend for 4 consecutive years.

Risk and Volatility

Archrock Partners has a beta of 2, indicating that its stock price is 100% more volatile than the S&P 500. Comparatively, Southcross Energy Partners has a beta of 4.08, indicating that its stock price is 308% more volatile than the S&P 500.

Institutional & Insider Ownership

44.4% of Archrock Partners shares are held by institutional investors. Comparatively, 2.9% of Southcross Energy Partners shares are held by institutional investors. 0.4% of Archrock Partners shares are held by insiders. Comparatively, 23.8% of Southcross Energy Partners shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Archrock Partners and Southcross Energy Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Archrock Partners -0.08% 3.74% 0.99%
Southcross Energy Partners -11.18% -14.49% -6.51%

Analyst Ratings

This is a summary of recent recommendations for Archrock Partners and Southcross Energy Partners, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Archrock Partners 0 2 1 0 2.33
Southcross Energy Partners 0 1 0 0 2.00

Archrock Partners currently has a consensus price target of $16.50, suggesting a potential upside of 7.84%. Given Archrock Partners’ stronger consensus rating and higher probable upside, analysts clearly believe Archrock Partners is more favorable than Southcross Energy Partners.

Valuation and Earnings

This table compares Archrock Partners and Southcross Energy Partners’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Archrock Partners $557.50 million 1.97 -$420,000.00 $0.27 56.67
Southcross Energy Partners $665.95 million 0.06 -$67.59 million N/A N/A

Archrock Partners has higher earnings, but lower revenue than Southcross Energy Partners.

Summary

Archrock Partners beats Southcross Energy Partners on 10 of the 15 factors compared between the two stocks.

Archrock Partners Company Profile

Archrock Partners, L.P., together with its subsidiaries, provides natural gas contract operations services to customers in the United States. The company's contract operations services primarily include designing, sourcing, owning, installing, operating, servicing, repairing, and maintaining equipment to provide natural gas compression services to its customers. It serves companies engaged in various aspects of the oil and natural gas industry, including oil and natural gas producers, processors, gatherers, transporters, and storage providers. The company markets its services through sales and field service personnel. Archrock General Partner, L.P. operates as the general partner of the company. The company was formerly known as Exterran Partners, L.P. and changed its name to Archrock Partners, L.P. in November 2015. Archrock Partners, L.P. was founded in 2006 and is based in Houston, Texas.

Southcross Energy Partners Company Profile

Southcross Energy Partners, L.P., together with its subsidiaries, provides natural gas gathering, processing, treating, compression, and transportation services in the United States. The company also offers natural gas liquid (NGL) fractionation and transportation services. In addition, it supplies natural gas to industrial, commercial, and power generation customers, as well as local distribution companies. The company operates 2 gas processing plants, 1 fractionation plant, and gathering and transportation pipelines in South Texas, Mississippi, and Alabama. Southcross Energy Partners GP, LLC operates as a general partner of Southcross Energy Partners, L.P. The company was founded in 2009 and is headquartered in Dallas, Texas. Southcross Energy Partners, L.P. is a subsidiary of Southcross Holdings LP.

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