Financial Review: SunocoCorp (NYSE:SUNC) vs. Texas Pacific Land (NYSE:TPL)

SunocoCorp (NYSE:SUNC) and Texas Pacific Land (NYSE:TPL) are both energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, profitability, dividends, institutional ownership, risk and earnings.

Analyst Ratings

This is a summary of current recommendations and price targets for SunocoCorp and Texas Pacific Land, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SunocoCorp	1	1	3	1	2.67
Texas Pacific Land	1	2	1	0	2.00

SunocoCorp presently has a consensus target price of $81.00, suggesting a potential upside of 3.99%. Texas Pacific Land has a consensus target price of $639.00, suggesting a potential upside of 88.29%. Given Texas Pacific Land’s higher probable upside, analysts clearly believe Texas Pacific Land is more favorable than SunocoCorp.

Institutional and Insider Ownership

59.9% of Texas Pacific Land shares are held by institutional investors. 5.9% of SunocoCorp shares are held by company insiders. Comparatively, 6.9% of Texas Pacific Land shares are held 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.

Valuation & Earnings

This table compares SunocoCorp and Texas Pacific Land”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SunocoCorp	$53.96 billion	0.07	-$5.00 million	$2.89	26.95
Texas Pacific Land	$798.19 million	29.32	$481.38 million	$7.85	43.23

Texas Pacific Land has lower revenue, but higher earnings than SunocoCorp. SunocoCorp 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.

Dividends

SunocoCorp pays an annual dividend of $4.00 per share and has a dividend yield of 5.1%. Texas Pacific Land pays an annual dividend of $2.40 per share and has a dividend yield of 0.7%. SunocoCorp pays out 138.4% 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 pays out 30.6% of its earnings in the form of a dividend. Texas Pacific Land has raised its dividend for 3 consecutive years.

Profitability

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

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

Summary

Texas Pacific Land beats SunocoCorp on 12 of the 17 factors compared between the two stocks.

About SunocoCorp

Sunoco LP is an energy infrastructure and fuel distribution master limited partnership. Sunoco LP is based in DALLAS.

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.