Analyzing Tc Pipelines (NYSE:TRP) and Altus Midstream (NYSE:ALTM)

Altus Midstream (NASDAQ:ALTM) and Tc Pipelines (NYSE:TRP) are both oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Analyst Ratings

This is a summary of current ratings and target prices for Altus Midstream and Tc Pipelines, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Altus Midstream 0 0 0 0 N/A
Tc Pipelines 0 4 17 0 2.81

Tc Pipelines has a consensus price target of $68.93, indicating a potential upside of 56.94%. Given Tc Pipelines’ higher probable upside, analysts clearly believe Tc Pipelines is more favorable than Altus Midstream.

Earnings & Valuation

This table compares Altus Midstream and Tc Pipelines’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Altus Midstream $135.80 million 1.32 -$1.34 billion $175.60 0.06
Tc Pipelines $9.99 billion 4.13 $3.12 billion $3.12 14.08

Tc Pipelines has higher revenue and earnings than Altus Midstream. Altus Midstream is trading at a lower price-to-earnings ratio than Tc Pipelines, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

66.3% of Tc Pipelines shares are held by institutional investors. 3.4% of Altus Midstream shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

Altus Midstream has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500. Comparatively, Tc Pipelines has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500.

Profitability

This table compares Altus Midstream and Tc Pipelines’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Altus Midstream -276.06% 1,143.02% 35.86%
Tc Pipelines 33.69% 13.73% 3.93%

Summary

Tc Pipelines beats Altus Midstream on 8 of the 13 factors compared between the two stocks.

Altus Midstream Company Profile

Altus Midstream Company owns gas gathering, processing, and transmission assets in the Permian Basin of West Texas. As of December 31, 2019, its assets included approximately 178 miles of in-service natural gas gathering, 55 miles of residue gas, and 38 miles of natural gas liquids (NGL) pipelines; three cryogenic processing trains; and an NGL truck loading terminal with six lease automatic custody transfer units and eight NGL bullet tanks. The company is based in Houston, Texas. Altus Midstream Company is a subsidiary of Apache Midstream LLC.

Tc Pipelines Company Profile

TC Energy Corporation operates as an energy infrastructure company in North America. It operates through Canadian Natural Gas Pipelines, U.S. Natural Gas Pipelines, Mexico Natural Gas Pipelines, Liquids Pipelines, and Energy segments. The company transports natural gas to local distribution companies, power generation plants, industrial facilities, interconnecting pipelines, and other businesses. It owns and operates wholly-owned natural gas pipelines of 81,500 kilometers and partially-owned natural gas pipelines of 11,100 kilometers; and regulated natural gas storage facilities with a total working gas capacity of 535 billion cubic feet. The company also owns and manages midstream assets that provide natural gas producer services, including gathering, treatment, conditioning, processing, and liquids handling with a focus on the Appalachian Basin. In addition, it owns and operates liquids pipelines infrastructure for the transportation of Alberta crude oil supplies to the refining markets in Illinois, Oklahoma, and the U.S. Gulf Coast, as well as U.S. crude oil supplies from the market hub at Cushing, Oklahoma to the U.S. Gulf Coast. Further, the company operates 10 power generation facilities with a power generation capacity of 6,615 megawatt powered by natural gas and nuclear fuel sources located in Alberta, Ontario, Qu├ębec, New Brunswick, and Arizona; and owns and operates approximately 118 billion cubic feet of unregulated natural gas storage capacity in Alberta. The company was formerly known as TransCanada Corporation and changed its name to TC Energy Corporation in May 2019. TC Energy Corporation was founded in 1951 and is headquartered in Calgary, Canada.

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