Plains GP (NYSE:PAGP) versus HF Sinclair (NYSE:DINO) Critical Analysis

Plains GP (NYSE:PAGPGet Rating) and HF Sinclair (NYSE:DINOGet Rating) are both oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, risk, profitability and institutional ownership.

Analyst Recommendations

This is a summary of recent ratings and target prices for Plains GP and HF Sinclair, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Plains GP 1 2 7 0 2.60
HF Sinclair 0 1 6 0 2.86

Plains GP currently has a consensus target price of $13.56, suggesting a potential upside of 8.94%. HF Sinclair has a consensus target price of $54.00, suggesting a potential upside of 2.20%. Given Plains GP’s higher possible upside, equities research analysts plainly believe Plains GP is more favorable than HF Sinclair.

Risk and Volatility

Plains GP has a beta of 1.75, meaning that its stock price is 75% more volatile than the S&P 500. Comparatively, HF Sinclair has a beta of 1.55, meaning that its stock price is 55% more volatile than the S&P 500.

Valuation and Earnings

This table compares Plains GP and HF Sinclair’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Plains GP $42.04 billion 0.06 $60.00 million $0.07 177.86
HF Sinclair $18.39 billion 0.64 $558.32 million $3.40 15.54

HF Sinclair has lower revenue, but higher earnings than Plains GP. HF Sinclair is trading at a lower price-to-earnings ratio than Plains GP, indicating that it is currently the more affordable of the two stocks.

Dividends

Plains GP pays an annual dividend of $0.87 per share and has a dividend yield of 7.0%. HF Sinclair pays an annual dividend of $1.60 per share and has a dividend yield of 3.0%. Plains GP pays out 1,242.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. HF Sinclair pays out 47.1% of its earnings in the form of a dividend.

Profitability

This table compares Plains GP and HF Sinclair’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Plains GP 0.03% 0.10% 0.05%
HF Sinclair 2.55% 7.42% 3.64%

Insider and Institutional Ownership

90.5% of Plains GP shares are owned by institutional investors. Comparatively, 88.2% of HF Sinclair shares are owned by institutional investors. 9.6% of Plains GP shares are owned by company insiders. Comparatively, 0.4% of HF Sinclair shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Plains GP Company Profile (Get Rating)

Plains GP Holdings, L.P., together with its subsidiaries, owns and operates midstream energy infrastructure in the United States and Canada. The company operates in two segments, Crude Oil and Natural Gas Liquids (NGLs). The company engages in the transportation of crude oil and NGLs on pipelines, gathering systems, and trucks. As of December 31, 2021, this segment owned and leased assets comprising 18,300 miles of crude oil and NGL pipelines and gathering systems; 38 million barrels of above-ground tank capacity; and 1,275 trailers. It engages in the provision of storage, terminalling, and throughput services primarily for crude oil, NGLs, and natural gas; NGL fractionation and isomerization services; and natural gas and condensate processing services. As of December 31, 2021, this segment owned and operated approximately 74 million barrels of crude oil storage capacity; 28 million barrels of NGL storage capacity; four natural gas processing plants; a condensate processing facility; nine fractionation plants; 16 NGL rail terminals; four marine facilities; and 110 miles of pipelines. As of December 31, 2021, this segment owned 15 million barrels of crude oil and 2 NGL linefill; 3 million barrels of crude oil and 1 NGL linefill in pipelines owned by third parties and other inventory; 640 trucks and 1,275 trailers; and 3,900 NGL railcars. The company offers logistics services to producers, refiners, and other customers. PAA GP Holdings LLC operates as a general partner of the company. Plains GP Holdings, L.P. was incorporated in 2013 and is headquartered in Houston, Texas.

HF Sinclair Company Profile (Get Rating)

HF Sinclair Corporation operates as an independent energy company. It produces and markets gasoline, diesel fuel, jet fuel, renewable diesel, specialty lubricant products, specialty chemicals, specialty and modified asphalt, and others. The company also owns and operates refineries located in Kansas, Oklahoma, New Mexico, Utah, Washington, and Wyoming; and markets its refined products principally in the Southwest United States and Rocky Mountains, Pacific Northwest, and in other neighboring Plains states. In addition, it supplies fuels to approximately 1,300 independent Sinclair-branded stations and licenses the use of the Sinclair brand at approximately 300 additional locations, as well as engages in the growing renewables business. Further, the company produces base oils and other specialized lubricants; and provides petroleum product and crude oil transportation, terminalling, storage, and throughput services to the petroleum industry. HF Sinclair Corporation was incorporated in 2021 and is headquartered in Dallas, Texas.

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