Archrock Partners (APLP) & TC Pipelines (TCP) Financial Survey

Archrock Partners (NASDAQ:APLP) and TC Pipelines (NYSE:TCP) are both oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, valuation, risk, institutional ownership, dividends and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings for Archrock Partners and TC Pipelines, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Archrock Partners 0 1 1 0 2.50
TC Pipelines 5 6 0 0 1.55

Archrock Partners presently has a consensus target price of $18.00, suggesting a potential upside of ∞. TC Pipelines has a consensus target price of $43.78, suggesting a potential upside of 35.28%. Given Archrock Partners’ stronger consensus rating and higher probable upside, equities analysts clearly believe Archrock Partners is more favorable than TC Pipelines.

Insider and Institutional Ownership

44.4% of Archrock Partners shares are owned by institutional investors. Comparatively, 63.0% of TC Pipelines shares are owned by institutional investors. 0.4% of Archrock Partners shares are owned by insiders. Comparatively, 0.1% of TC Pipelines 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.

Profitability

This table compares Archrock Partners and TC Pipelines’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Archrock Partners N/A N/A N/A
TC Pipelines 67.81% 26.32% 8.35%

Dividends

Archrock Partners pays an annual dividend of $1.14 per share. TC Pipelines pays an annual dividend of $2.60 per share and has a dividend yield of 8.0%. TC Pipelines pays out 82.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TC Pipelines has raised its dividend for 9 consecutive years. TC Pipelines is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares Archrock Partners and TC Pipelines’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Archrock Partners N/A N/A N/A N/A N/A
TC Pipelines $422.00 million 5.47 $252.00 million $3.16 10.24

TC Pipelines has higher revenue and earnings than Archrock Partners.

Summary

TC Pipelines beats Archrock Partners on 7 of the 12 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.

TC Pipelines Company Profile

TC PipeLines, LP acquires, owns, and participates in the management of energy infrastructure businesses in North America. The company has interests in eight natural gas interstate pipeline systems that transport approximately 10.4 billion cubic feet per day of natural gas from producing regions and import facilities to market hubs and consuming markets primarily in the Western, Midwestern, and Eastern United States. It serves large utilities, local distribution companies, natural gas marketers, producing companies, and other interstate pipelines, including affiliates. TC PipeLines GP, Inc. operates as a general partner of the company. TC PipeLines, LP was founded in 1998 and is based in Houston, Texas.

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