Dominion Energy Midstream Partners (NYSE: WMB) and Williams Companies (NYSE:WMB) are both oils/energy companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, institutional ownership, profitability, earnings, dividends, risk and analyst recommendations.
Dominion Energy Midstream Partners pays an annual dividend of $1.40 per share and has a dividend yield of 8.9%. Williams Companies pays an annual dividend of $1.36 per share and has a dividend yield of 4.4%. Dominion Energy Midstream Partners pays out 103.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Williams Companies pays out 215.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Dominion Energy Midstream Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.
35.5% of Dominion Energy Midstream Partners shares are owned by institutional investors. Comparatively, 86.8% of Williams Companies shares are owned by institutional investors. 11.2% of Dominion Energy Midstream Partners shares are owned by insiders. Comparatively, 0.5% of Williams Companies shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Valuation & Earnings
This table compares Dominion Energy Midstream Partners and Williams Companies’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Dominion Energy Midstream Partners||$480.20 million||4.17||$195.10 million||$1.35||11.70|
|Williams Companies||$8.03 billion||3.16||$2.17 billion||$0.63||48.71|
Williams Companies has higher revenue and earnings than Dominion Energy Midstream Partners. Dominion Energy Midstream Partners is trading at a lower price-to-earnings ratio than Williams Companies, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent recommendations and price targets for Dominion Energy Midstream Partners and Williams Companies, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Dominion Energy Midstream Partners||1||8||2||0||2.09|
Dominion Energy Midstream Partners currently has a consensus target price of $25.64, indicating a potential upside of 62.26%. Williams Companies has a consensus target price of $33.46, indicating a potential upside of 9.03%. Given Dominion Energy Midstream Partners’ higher probable upside, analysts clearly believe Dominion Energy Midstream Partners is more favorable than Williams Companies.
This table compares Dominion Energy Midstream Partners and Williams Companies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Dominion Energy Midstream Partners||28.46%||2.76%||2.09%|
Volatility and Risk
Dominion Energy Midstream Partners has a beta of 1.95, indicating that its share price is 95% more volatile than the S&P 500. Comparatively, Williams Companies has a beta of 1.43, indicating that its share price is 43% more volatile than the S&P 500.
Dominion Energy Midstream Partners beats Williams Companies on 9 of the 16 factors compared between the two stocks.
Dominion Energy Midstream Partners Company Profile
Dominion Energy Midstream Partners, LP owns liquefied natural gas (LNG) terminalling, storage, regasification, and transportation assets. It owns and operates LNG terminalling and storage facility located on the Chesapeake Bay in Lusby, Maryland. The company also operates an interstate pipeline in South Carolina and southeastern Georgia comprising natural gas system consisting of approximately 1,500 miles of transmission pipeline and 5 compressor stations with approximately 34,500 installed compressor horsepower. In addition, it owns and operates a 416-mile interstate natural gas pipeline from the United States-Canadian border at Waddington, New York through the state of Connecticut to South Commack, Long Island, New York and continuing on from Northport, Long Island, New York through the Long Island Sound to Hunts Point, Bronx, New York providing service to local gas distribution companies, electric utilities, and electric power generators, as well as marketers and other end users through interconnecting pipelines and exchanges. Further, the company operates 2,200 miles of natural gas transportation pipelines in northeastern and central Utah, northwestern Colorado, and southwestern Wyoming. Dominion Energy Midstream GP, LLC serves as a general partner of the company. The company was founded in 2000 and is headquartered in Richmond, Virginia.
Williams Companies Company Profile
The Williams Companies, Inc. operates as an energy infrastructure company primarily in the United States. It owns and operates natural gas pipeline system extending from Texas, Louisiana, Mississippi, and the Gulf of Mexico through Alabama, Georgia, South Carolina, North Carolina, Virginia, Maryland, Delaware, Pennsylvania, and New Jersey to the New York City metropolitan area. The company also owns and operates a natural gas pipeline system extending from the San Juan basin in northwestern New Mexico and southwestern Colorado through Colorado, Utah, Wyoming, Idaho, Oregon, and Washington to a point on the Canadian border near Sumas, Washington; gulfstream natural gas pipeline system extending from the Mobile Bay area in Alabama to markets in Florida; and constitution pipeline that would connect its gathering system in Susquehanna County, Pennsylvania to the Iroquois Gas Transmission and Tennessee Gas Pipeline systems in New York. In addition, it provides natural gas gathering, treating, processing, and compression services; natural gas liquids production, fractionation, storage, marketing, and transportation services; and deepwater production handling and crude oil transportation services. The company transports and stores natural gas to local natural gas distribution companies, municipal utilities, direct industrial users, electric power generators, and natural gas marketers and producers. As of December 31, 2017, it owned and operated approximately 13,600 miles of pipelines. The Williams Companies, Inc. was founded in 1908 and is headquartered in Tulsa, Oklahoma.
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