Comparing Summit Midstream Partners (NYSE:SMC) & Arc Resources (OTCMKTS:AETUF)

Summit Midstream Partners (NYSE:SMC) and Arc Resources (OTCMKTS:AETUF) are both energy companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, earnings, valuation, risk, dividends, analyst recommendations and institutional ownership.

Earnings & Valuation

This table compares Summit Midstream Partners and Arc Resources”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Summit Midstream Partners	$619.45 million	1.01	$8.93 million	($0.40)	-77.13
Arc Resources	$4.35 billion	3.20	$912.59 million	$1.79	13.71

Arc Resources has higher revenue and earnings than Summit Midstream Partners. Summit Midstream Partners is trading at a lower price-to-earnings ratio than Arc Resources, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Summit Midstream Partners and Arc Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Summit Midstream Partners	1.61%	1.17%	0.41%
Arc Resources	19.75%	16.67%	9.09%

Analyst Recommendations

This is a summary of recent recommendations for Summit Midstream Partners and Arc Resources, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Summit Midstream Partners	0	2	2	0	2.50
Arc Resources	1	10	2	0	2.08

Summit Midstream Partners presently has a consensus target price of $43.00, suggesting a potential upside of 39.38%. Given Summit Midstream Partners’ stronger consensus rating and higher probable upside, equities analysts plainly believe Summit Midstream Partners is more favorable than Arc Resources.

Risk and Volatility

Summit Midstream Partners has a beta of 0.88, indicating that its stock price is 12% less volatile than the S&P 500. Comparatively, Arc Resources has a beta of 0.27, indicating that its stock price is 73% less volatile than the S&P 500.

Insider and Institutional Ownership

43.0% of Summit Midstream Partners shares are held by institutional investors. Comparatively, 2.5% of Arc Resources shares are held by institutional investors. 43.0% of Summit Midstream Partners shares are held by company insiders. Comparatively, 0.3% of Arc Resources shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Arc Resources beats Summit Midstream Partners on 8 of the 13 factors compared between the two stocks.

About Summit Midstream Partners

Summit Midstream Corporation, formerly Summit Midstream Partners, is a midstream energy company that provides infrastructure and services to natural gas and crude oil producers. Its operations include gathering, compressing, treating and processing natural gas, as well as gathering and handling crude oil and produced water. The company’s assets serve production areas including the Williston Basin in North Dakota, the Piceance and Denver-Julesburg basins in Colorado, the Permian Basin in Texas and the Barnett Shale in Texas.

About Arc Resources

ARC Resources Ltd. is a Canadian energy company that explores for, develops and produces natural gas, condensate, crude oil and other natural gas liquids. Its operations are focused on the Montney formation in Alberta and British Columbia, where the company develops unconventional energy resources. Founded in 1996 and headquartered in Calgary, ARC has built its business around the Montney, a large resource basin spanning parts of western Canada. Its production is marketed to customers in Canada and international markets, including through connections to liquefied natural gas export infrastructure.