Head-To-Head Contrast: Texas Pacific Land (NYSE:TPL) and Anadarko Petroleum (NASDAQ:APC)

Texas Pacific Land (NYSE:TPL) and Anadarko Petroleum (NASDAQ:APC) are both energy companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.

Dividends

Texas Pacific Land pays an annual dividend of $2.40 per share and has a dividend yield of 0.7%. Anadarko Petroleum pays an annual dividend of $2.00 per share and has a dividend yield of 12.6%. Texas Pacific Land pays out 30.6% of its earnings in the form of a dividend. Anadarko Petroleum pays out 289.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Texas Pacific Land has increased its dividend for 3 consecutive years.

Profitability

This table compares Texas Pacific Land and Anadarko Petroleum’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Texas Pacific Land	60.32%	35.76%	32.04%
Anadarko Petroleum	N/A	N/A	N/A

Valuation and Earnings

This table compares Texas Pacific Land and Anadarko Petroleum”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Texas Pacific Land	$798.19 million	29.81	$481.38 million	$7.85	43.95
Anadarko Petroleum	$5.58 billion	0.04	$32.73 million	$0.69	22.97

Texas Pacific Land has higher earnings, but lower revenue than Anadarko Petroleum. Anadarko Petroleum is trading at a lower price-to-earnings ratio than Texas Pacific Land, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for Texas Pacific Land and Anadarko Petroleum, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Texas Pacific Land	0	1	2	0	2.67
Anadarko Petroleum	0	2	4	1	2.86

Texas Pacific Land currently has a consensus price target of $639.00, indicating a potential upside of 85.21%. Anadarko Petroleum has a consensus price target of $21.80, indicating a potential upside of 37.54%. Given Texas Pacific Land’s higher possible upside, equities analysts clearly believe Texas Pacific Land is more favorable than Anadarko Petroleum.

Insider & Institutional Ownership

59.9% of Texas Pacific Land shares are owned by institutional investors. 0.3% of Texas Pacific Land shares are owned by company insiders. Comparatively, 0.5% of Anadarko Petroleum shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Texas Pacific Land beats Anadarko Petroleum on 10 of the 16 factors compared between the two stocks.

About Texas Pacific Land

Texas Pacific Land Corporation engages in the land and resource management, and water services and operations businesses. The company owns a 1/128th nonparticipating perpetual oil and gas royalty interest (NPRI) under approximately 85,000 acres of land; a 1/16th NPRI under approximately 371,000 acres of land; and approximately 4,000 additional net royalty acres, total of approximately 195,000 NRA located in the western part of Texas. The Land and Resource Management segment manages surface acres of land, and oil and gas royalty interest in West Texas. This segment also engages in easements, such as transporting oil, gas and related hydrocarbons, power line and utility, and subsurface wellbore easements. In addition, this segment leases its land for processing, storage, and compression facilities and roads; and is involved in sale of materials, such as caliche, sand, and other material, as well as sells land. The Water Services and Operations segment provides full-service water offerings, including water sourcing, produced-water treatment, infrastructure development, and disposal solutions to operators in the Permian Basin. This segment also holds produced water royalties. Texas Pacific Land Corporation was founded in 1888 and is headquartered in Dallas, Texas.

About Anadarko Petroleum

Anadarko Petroleum Corporation engages in the exploration, development, production, and marketing of oil and gas properties. It operates through three segments: Exploration and Production, WES Midstream, and Other Midstream. The company explores for and produces oil, natural gas, and natural gas liquids (NGLs). It is also involved in gathering, processing, treating, and transporting oil, natural-gas, and NGLs production, as well as the gathering and disposal of produced water. The company's oil and natural gas properties are located in the United States onshore and deepwater Gulf of Mexico; and Algeria, Ghana, Mozambique, Colombia, Peru, and other countries. As of December 31, 2018, it had approximately 1.5 billion barrels of oil equivalent of proved reserves. The company was founded in 1959 and is headquartered in The Woodlands, Texas.