Head-To-Head Review: Macquarie Infrastructure (MIC) & NGL Energy Partners (NGL)

Macquarie Infrastructure (NYSE: MIC) and NGL Energy Partners (NYSE:NGL) are both multi-sector conglomerates companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.

Dividends

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Macquarie Infrastructure pays an annual dividend of $5.76 per share and has a dividend yield of 14.7%. NGL Energy Partners pays an annual dividend of $1.56 per share and has a dividend yield of 13.0%. Macquarie Infrastructure pays out 225.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NGL Energy Partners pays out 164.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Macquarie Infrastructure has increased its dividend for 6 consecutive years. Macquarie Infrastructure is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Macquarie Infrastructure has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500. Comparatively, NGL Energy Partners has a beta of 1.04, indicating that its share price is 4% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Macquarie Infrastructure and NGL Energy Partners, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Macquarie Infrastructure 1 4 1 0 2.00
NGL Energy Partners 0 2 3 0 2.60

Macquarie Infrastructure currently has a consensus target price of $57.00, indicating a potential upside of 45.71%. NGL Energy Partners has a consensus target price of $15.80, indicating a potential upside of 31.67%. Given Macquarie Infrastructure’s higher possible upside, equities analysts plainly believe Macquarie Infrastructure is more favorable than NGL Energy Partners.

Profitability

This table compares Macquarie Infrastructure and NGL Energy Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Macquarie Infrastructure 24.86% 4.83% 1.95%
NGL Energy Partners -0.97% -1.85% -0.57%

Institutional and Insider Ownership

76.1% of Macquarie Infrastructure shares are held by institutional investors. Comparatively, 65.6% of NGL Energy Partners shares are held by institutional investors. 6.9% of Macquarie Infrastructure 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 & Earnings

This table compares Macquarie Infrastructure and NGL Energy Partners’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Macquarie Infrastructure $1.81 billion 1.83 $451.20 million $2.56 15.28
NGL Energy Partners $13.02 billion 0.11 $136.81 million $0.95 12.63

Macquarie Infrastructure has higher earnings, but lower revenue than NGL Energy Partners. NGL Energy Partners is trading at a lower price-to-earnings ratio than Macquarie Infrastructure, indicating that it is currently the more affordable of the two stocks.

Summary

Macquarie Infrastructure beats NGL Energy Partners on 13 of the 17 factors compared between the two stocks.

Macquarie Infrastructure Company Profile

Macquarie Infrastructure Corporation owns and operates a portfolio of businesses that provide services to other businesses, government agencies, and individuals. It operates through four segments: International-Matex Tank Terminals (IMTT), Atlantic Aviation, Contracted Power (CP), and MIC Hawaii. The IMTT segment offers bulk liquid storage, handling, and other services for petroleum products, chemicals, renewable fuels, and vegetable and animal oils through a network of 19 marine terminals, including 17 in the United States and 2 in Canada. This segment also provides environmental emergency response, industrial, and waste transportation and disposal services. The Atlantic Aviation segment offers fuel delivery, de-icing, aircraft parking, and hangar rental services to owners/operators of jet aircraft, as well as for commercial, military, freight, and government aviation customers. The CP segment generates electricity through wind, solar, and gas-fired facilities. As of December 31, 2017, this segment had interests in 7 solar power generating facilities with an aggregate generating capacity of 142 megawatts (MW) located in Arizona, California, Texas, Minnesota, and Utah; 2 wind power generating facilities with an aggregate generating capacity of 203 MW situated in Idaho and New Mexico; and gas-fired facility with a generating capacity of 512 MW located in Bayonne, New Jersey. The MIC Hawaii segment processes, distributes, and sells synthetic and renewable natural gas; and distributes and sells liquefied natural gas and petroleum gas to residential, commercial, hospitality, military, and wholesale customers, as well as to the public sector in Oahu, Hawaii, Maui, Kauai, Molokai, and Lanai. This segment's products are used in various commercial and residential applications, such as water heating, drying, cooking, power generation, and other uses, as well as for use in specialty vehicles. The company was founded in 2004 and is based in New York, New York.

NGL Energy Partners Company Profile

NGL Energy Partners LP, through its subsidiaries, engages in the crude oil logistics, water solutions, liquids, retail propane, and refined products and renewables businesses in the United States. The Crude Oil Logistics segment purchases crude oil from producers and transports it to refineries for resale at pipeline injection stations, storage terminals, barge loading facilities, rail facilities, refineries, and other trade hubs. The Water Solutions segment is involved in the treatment and disposal of wastewater generated from crude oil and natural gas production operations; disposal of solids, such as tank bottoms, drilling fluids, and performs truck and frac tank washouts; and sale of recovered hydrocarbons. The Liquids segment supplies natural gas liquids to retailers, wholesalers, refiners, and petrochemical plants in the United States and Canada, as well as offers terminaling and storage services through its 21 terminals in the United States. The Retail Propane segment sells propane, distillates, and equipment and supplies to end users consisting of residential, agricultural, commercial, and industrial customers, as well as re-sellers. The Refined Products and Renewables segment markets gasoline, diesel, ethanol, and biodiesel products; and purchase and delivers refined petroleum and renewable products. NGL Energy Holdings LLC serves as the general partner of the company. The company was founded in 1940 and is headquartered in Tulsa, Oklahoma.

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