Chesapeake Utilities (NYSE:CPK – Get Free Report) and Suburban Propane Partners (NYSE:SPH – Get Free Report) are both utilities companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, dividends, earnings, analyst recommendations, profitability and risk.
Risk & Volatility
Chesapeake Utilities has a beta of 0.68, suggesting that its share price is 32% less volatile than the S&P 500. Comparatively, Suburban Propane Partners has a beta of 0.4, suggesting that its share price is 60% less volatile than the S&P 500.
Dividends
Chesapeake Utilities pays an annual dividend of $2.94 per share and has a dividend yield of 2.2%. Suburban Propane Partners pays an annual dividend of $1.30 per share and has a dividend yield of 7.4%. Chesapeake Utilities pays out 46.9% of its earnings in the form of a dividend. Suburban Propane Partners pays out 66.3% 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. Chesapeake Utilities has increased its dividend for 22 consecutive years.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Chesapeake Utilities | 0 | 3 | 1 | 0 | 2.25 |
| Suburban Propane Partners | 0 | 1 | 0 | 2 | 3.33 |
Chesapeake Utilities presently has a consensus target price of $138.00, suggesting a potential upside of 1.98%. Given Chesapeake Utilities’ higher probable upside, equities research analysts clearly believe Chesapeake Utilities is more favorable than Suburban Propane Partners.
Earnings and Valuation
This table compares Chesapeake Utilities and Suburban Propane Partners”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Chesapeake Utilities | $930.00 million | 3.51 | $140.30 million | $6.27 | 21.58 |
| Suburban Propane Partners | $1.43 billion | 0.82 | $106.57 million | $1.96 | 8.98 |
Chesapeake Utilities has higher earnings, but lower revenue than Suburban Propane Partners. Suburban Propane Partners is trading at a lower price-to-earnings ratio than Chesapeake Utilities, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
83.1% of Chesapeake Utilities shares are held by institutional investors. Comparatively, 30.9% of Suburban Propane Partners shares are held by institutional investors. 1.4% of Chesapeake Utilities shares are held by insiders. Comparatively, 1.3% of Suburban Propane Partners 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.
Profitability
This table compares Chesapeake Utilities and Suburban Propane Partners’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Chesapeake Utilities | 15.12% | 9.34% | 3.73% |
| Suburban Propane Partners | 9.37% | 18.57% | 5.25% |
Summary
Chesapeake Utilities beats Suburban Propane Partners on 12 of the 18 factors compared between the two stocks.
About Chesapeake Utilities
Chesapeake Utilities Corporation operates as an energy delivery company. The company operates through two segments, Regulated Energy and Unregulated Energy. The Regulated Energy segment natural gas distribution operations in central and southern Delaware, Maryland's eastern shore, and Florida; regulated natural gas transmission in the Delmarva Peninsula, Ohio, and Florida; and regulated electric distribution in northeast and northwest Florida. The Unregulated Energy segment engages in the propane operations in the Mid-Atlantic region, North Carolina, South Carolina, and Florida; unregulated natural gas transmission/supply operation in central and eastern Ohio; generation of electricity and steam; provision of compressed natural gas, liquefied natural gas, and renewable natural gas transportation and pipeline solutions primarily to utilities and pipelines in the United States; and sustainable energy investments. This segment is also involved in the provision of other unregulated services, such as energy-related merchandise sale and heating, ventilation and air conditioning, and plumbing and electrical services. Chesapeake Utilities Corporation was founded in 1859 and is headquartered in Dover, Delaware.
About Suburban Propane Partners
Suburban Propane Partners, L.P., through its subsidiaries, engages in the retail marketing and distribution of propane, renewable propane, fuel oil, and refined fuels in the United States. The company operates through four segments: Propane, Fuel Oil and Refined Fuels, Natural Gas and Electricity, and All Other. The Propane segment is involved in the retail distribution of propane for space heating, water heating, cooking, and clothes drying for use as a motor fuel in internal combustion engines to power over-the-road vehicles, forklifts, and stationary engines, as well as to fire furnaces as a cutting gas to the industrial customers; and for tobacco curing, crop drying, poultry brooding, and weed control in the agricultural markets. It also engages in the wholesale distribution of propane to industrial end users. Its Fuel Oil and Refined Fuels segment engages in the retail distribution of fuel oil, diesel, kerosene, and gasoline to residential and commercial customers for use in primarily as a source of heat in homes and buildings. The Natural Gas and Electricity segment markets natural gas and electricity to residential and commercial customers in the deregulated energy markets in New York and Pennsylvania. The All Other segment sells, installs, and services a range of home comfort equipment, including whole-house heating products, air cleaners, humidifiers, and space heaters. The company serves residential, commercial, industrial, and agricultural customers primarily in the east and west coast regions of the United States, as well as portions of the Midwest region of the United States and Alaska. Suburban Propane Partners, L.P. was founded in 1945 and is based in Whippany, New Jersey.
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