Archrock (NYSE: AROC) and Antero Midstream GP (NYSE:AMGP) are both oils/energy companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.
Insider & Institutional Ownership
91.3% of Archrock shares are owned by institutional investors. Comparatively, 73.9% of Antero Midstream GP shares are owned by institutional investors. 2.5% of Archrock shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Earnings & Valuation
This table compares Archrock and Antero Midstream GP’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Archrock||$794.66 million||1.07||$18.95 million||($0.20)||-59.25|
|Antero Midstream GP||$69.72 million||47.43||$2.32 million||$0.03||592.00|
Archrock has higher revenue and earnings than Antero Midstream GP. Archrock is trading at a lower price-to-earnings ratio than Antero Midstream GP, indicating that it is currently the more affordable of the two stocks.
This table compares Archrock and Antero Midstream GP’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Antero Midstream GP||21.79%||116.75%||62.16%|
This is a summary of recent ratings for Archrock and Antero Midstream GP, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Antero Midstream GP||0||5||11||1||2.76|
Archrock currently has a consensus price target of $13.80, indicating a potential upside of 16.46%. Antero Midstream GP has a consensus price target of $24.53, indicating a potential upside of 38.12%. Given Antero Midstream GP’s stronger consensus rating and higher probable upside, analysts plainly believe Antero Midstream GP is more favorable than Archrock.
Archrock pays an annual dividend of $0.48 per share and has a dividend yield of 4.1%. Antero Midstream GP pays an annual dividend of $0.43 per share and has a dividend yield of 2.4%. Archrock pays out -240.0% of its earnings in the form of a dividend. Antero Midstream GP pays out 1,433.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Archrock is clearly the better dividend stock, given its higher yield and lower payout ratio.
Antero Midstream GP beats Archrock on 9 of the 15 factors compared between the two stocks.
Archrock, Inc. engages in the natural gas contract operations services business in the United States. The company provides natural gas compression services to customers in the oil and natural gas industry. It also offers aftermarket services, such as parts and components; and operation, maintenance, overhaul, and reconfiguration services to customers who own compression equipment. The company was formerly known as Exterran Holdings, Inc. and changed its name to Archrock, Inc. in November 2015. Archrock, Inc. was founded in 1990 and is headquartered in Houston, Texas.
About Antero Midstream GP
Antero Midstream GP LP owns, operates, and develops midstream energy assets in the Marcellus and Utica Shales in West Virginia and Ohio. Its assets consist of gathering pipelines, compressor stations, interests in processing and fractionation plants, and water handling and treatment assets, which provide midstream services to Antero Resources Corporation under long term fixed fee contracts. The company was formerly known as Antero Resources Midstream Management LLC and changed its name to Antero Midstream GP LP in May 2017. Antero Midstream GP LP was founded in 2013 and is based in Denver, Colorado.
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