Head-To-Head Comparison: Murphy Oil (NYSE:MUR) vs. Plains GP (NYSE:PAGP)

Murphy Oil (NYSE:MUR) and Plains GP (NYSE:PAGP) are both mid-cap energy companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, analyst recommendations, valuation, institutional ownership and profitability.

Dividends

Murphy Oil pays an annual dividend of $1.40 per share and has a dividend yield of 3.8%. Plains GP pays an annual dividend of $1.67 per share and has a dividend yield of 6.5%. Murphy Oil pays out 43.6% of its earnings in the form of a dividend. Plains GP pays out 59.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Murphy Oil has increased its dividend for 5 consecutive years.

Insider & Institutional Ownership

78.3% of Murphy Oil shares are held by institutional investors. Comparatively, 88.3% of Plains GP shares are held by institutional investors. 5.8% of Murphy Oil shares are held by company insiders. Comparatively, 6.9% of Plains GP shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

Murphy Oil has a beta of 0.52, suggesting that its stock price is 48% less volatile than the S&P 500. Comparatively, Plains GP has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Murphy Oil and Plains GP, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Murphy Oil	2	8	4	1	2.27
Plains GP	2	6	5	1	2.36

Murphy Oil presently has a consensus target price of $39.75, indicating a potential upside of 8.32%. Plains GP has a consensus target price of $26.00, indicating a potential upside of 1.26%. Given Murphy Oil’s higher probable upside, equities analysts plainly believe Murphy Oil is more favorable than Plains GP.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Murphy Oil	14.90%	8.51%	4.48%
Plains GP	0.21%	0.70%	0.36%

Valuation and Earnings

This table compares Murphy Oil and Plains GP”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Murphy Oil	$3.12 billion	1.69	$104.23 million	$3.21	11.43
Plains GP	$52.30 billion	0.10	$103.00 million	$2.79	9.20

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

Summary

Murphy Oil beats Plains GP on 9 of the 17 factors compared between the two stocks.

About Murphy Oil

Murphy Oil Corporation, together with its subsidiaries, operates as an oil and gas exploration and production company in the United States, Canada, and internationally. It explores for and produces crude oil, natural gas, and natural gas liquids. The company was formerly known as Murphy Corporation and changed its name to Murphy Oil Corporation in 1964. The company was incorporated in 1950 and is headquartered in Houston, Texas.

About Plains GP

Plains GP Holdings, L.P., through its subsidiary, Plains All American Pipeline, L.P., owns and operates midstream infrastructure systems in the United States and Canada. It operates in two segments, Crude Oil and Natural Gas Liquids (NGLs). The company engages in the gathering and transporting crude oil and NGLs using pipelines, gathering systems, and trucks. It engages in the loading and unloading services at terminals; NGL fractionation and isomerization services; and natural gas and condensate processing services. 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.