Financial Contrast: Cheniere Energy (NYSE:LNG) and BW LPG (NYSE:BWLP)

BW LPG (NYSE:BWLP) and Cheniere Energy (NYSE:LNG) are both energy companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, profitability, risk, institutional ownership, analyst recommendations, earnings and dividends.

Insider and Institutional Ownership

87.3% of Cheniere Energy shares are held by institutional investors. 0.6% of Cheniere Energy shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

BW LPG has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500. Comparatively, Cheniere Energy has a beta of -0.01, indicating that its stock price is 101% less volatile than the S&P 500.

Dividends

BW LPG pays an annual dividend of $2.68 per share and has a dividend yield of 12.9%. Cheniere Energy pays an annual dividend of $2.22 per share and has a dividend yield of 0.9%. BW LPG pays out 112.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cheniere Energy pays out 36.5% of its earnings in the form of a dividend.

Profitability

This table compares BW LPG and Cheniere Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BW LPG	10.13%	18.51%	10.92%
Cheniere Energy	7.23%	38.95%	9.34%

Analyst Recommendations

This is a summary of current ratings and price targets for BW LPG and Cheniere Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BW LPG	0	2	3	0	2.60
Cheniere Energy	0	2	16	3	3.05

Cheniere Energy has a consensus price target of $298.88, indicating a potential upside of 17.25%. Given Cheniere Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Cheniere Energy is more favorable than BW LPG.

Valuation and Earnings

This table compares BW LPG and Cheniere Energy”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BW LPG	$3.58 billion	0.88	$242.31 million	$2.38	8.75
Cheniere Energy	$19.98 billion	2.67	$5.33 billion	$6.08	41.93

Cheniere Energy has higher revenue and earnings than BW LPG. BW LPG is trading at a lower price-to-earnings ratio than Cheniere Energy, indicating that it is currently the more affordable of the two stocks.

Summary

Cheniere Energy beats BW LPG on 13 of the 17 factors compared between the two stocks.

About BW LPG

BW LPG Limited, an investment holding company, engages in ship owning and chartering activities worldwide. The company operates through Shipping and Product Services segments. The company involved in the transportation of liquefied petroleum gas to oil companies, and trading and utility companies. It also offers integrated liquified petroleum gas (LPG) delivery services and support; wholesale and trade of LPG; and management services. It owns and operates LPG vessels and a fleet of very large gas carriers. The company was formerly known as BW Gas LPG Holding Limited and changed its name to BW LPG Limited in September 2013. BW LPG Limited was founded in 1935 and is headquartered in Singapore.

About Cheniere Energy

Cheniere Energy, Inc., an energy infrastructure company, primarily engages in the liquefied natural gas (LNG) related businesses in the United States. It owns and operates the Sabine Pass LNG terminal in Cameron Parish, Louisiana; and the Corpus Christi LNG terminal near Corpus Christi, Texas. The company also owns Creole Trail pipeline, a 94-mile natural gas supply pipeline that interconnects the Sabine Pass LNG Terminal with several interstate and intrastate pipelines; and operates Corpus Christi pipeline, a 21.5-mile natural gas supply pipeline that interconnects the Corpus Christi LNG terminal with various interstate and intrastate natural gas pipelines. It is also involved in the LNG and natural gas marketing business. The company was incorporated in 1983 and is headquartered in Houston, Texas.