Frontline (NYSE:FRO – Get Free Report) and TXO Partners (NYSE:TXO – Get Free Report) are both energy companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, valuation, dividends and risk.
Dividends
Frontline pays an annual dividend of $10.44 per share and has a dividend yield of 18.6%. TXO Partners pays an annual dividend of $1.60 per share and has a dividend yield of 11.2%. Frontline pays out 156.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TXO Partners pays out -207.8% of its earnings in the form of a dividend. TXO Partners has increased its dividend for 1 consecutive years.
Profitability
This table compares Frontline and TXO Partners’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Frontline | 49.47% | 44.24% | 20.89% |
| TXO Partners | -9.23% | -5.59% | -2.83% |
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Frontline | 2 | 5 | 4 | 0 | 2.18 |
| TXO Partners | 1 | 0 | 2 | 2 | 3.00 |
Frontline presently has a consensus price target of $45.37, suggesting a potential downside of 19.21%. TXO Partners has a consensus price target of $19.00, suggesting a potential upside of 32.96%. Given TXO Partners’ stronger consensus rating and higher possible upside, analysts plainly believe TXO Partners is more favorable than Frontline.
Volatility & Risk
Frontline has a beta of 0.15, meaning that its share price is 85% less volatile than the S&P 500. Comparatively, TXO Partners has a beta of 0.08, meaning that its share price is 92% less volatile than the S&P 500.
Institutional and Insider Ownership
22.7% of Frontline shares are held by institutional investors. Comparatively, 27.4% of TXO Partners shares are held by institutional investors. 48.1% of Frontline shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares Frontline and TXO Partners”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Frontline | $1.97 billion | 6.34 | $379.08 million | $6.67 | 8.42 |
| TXO Partners | $401.01 million | 1.98 | -$21.62 million | ($0.77) | -18.56 |
Frontline has higher revenue and earnings than TXO Partners. TXO Partners is trading at a lower price-to-earnings ratio than Frontline, indicating that it is currently the more affordable of the two stocks.
Summary
Frontline beats TXO Partners on 12 of the 18 factors compared between the two stocks.
About Frontline
Frontline plc, a shipping company, engages in the seaborne transportation of crude oil and oil products worldwide. It owns and operates oil and product tankers. As of December 31, 2022, the company operated a fleet of 70 vessels. It is also involved in the charter, purchase, and sale of vessels. The company was founded in 1985 and is based in Limassol, Cyprus.
About TXO Partners
TXO Partners, L.P., an oil and natural gas company, focuses on the acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquid reserves in North America. Its acreage positions are concentrated in the Permian Basin of West Texas and New Mexico and the San Juan Basin of New Mexico and Colorado. The company was formerly known as TXO Energy Partners, L.P. and changed its name to TXO Partners, L.P. in May 2023. TXO Partners, L.P. was incorporated in 2012 and is based in Fort Worth, Texas.
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