NGL Energy Partners (NYSE:NGL – Get Free Report) and Natural Resource Partners (NYSE:NRP – Get Free Report) are both small-cap energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, earnings, institutional ownership, risk, analyst recommendations and valuation.
Profitability
This table compares NGL Energy Partners and Natural Resource Partners’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| NGL Energy Partners | -3.76% | -39.51% | 3.90% |
| Natural Resource Partners | 57.13% | 16.65% | 13.88% |
Volatility & Risk
NGL Energy Partners has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500. Comparatively, Natural Resource Partners has a beta of 0.24, suggesting that its stock price is 76% less volatile than the S&P 500.
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| NGL Energy Partners | $3.52 billion | 0.55 | -$142.29 million | ($2.84) | -5.51 |
| Natural Resource Partners | $207.28 million | 7.06 | $136.37 million | $7.84 | 14.08 |
Natural Resource Partners has lower revenue, but higher earnings than NGL Energy Partners. NGL Energy Partners is trading at a lower price-to-earnings ratio than Natural Resource Partners, indicating that it is currently the more affordable of the two stocks.
Dividends
NGL Energy Partners pays an annual dividend of $0.40 per share and has a dividend yield of 2.6%. Natural Resource Partners pays an annual dividend of $3.00 per share and has a dividend yield of 2.7%. NGL Energy Partners pays out -14.1% of its earnings in the form of a dividend. Natural Resource Partners pays out 38.3% 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.
Institutional & Insider Ownership
40.6% of NGL Energy Partners shares are held by institutional investors. Comparatively, 31.8% of Natural Resource Partners shares are held by institutional investors. 7.3% of NGL Energy Partners shares are held by company insiders. Comparatively, 35.3% of Natural Resource Partners shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for NGL Energy Partners and Natural Resource Partners, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| NGL Energy Partners | 1 | 0 | 0 | 1 | 2.50 |
| Natural Resource Partners | 0 | 1 | 0 | 0 | 2.00 |
Summary
Natural Resource Partners beats NGL Energy Partners on 9 of the 15 factors compared between the two stocks.
About NGL Energy Partners
NGL Energy Partners LP engages in the transportation, storage, blending, and marketing of crude oil, natural gas liquids, refined products / renewables, and water solutions. The company operates in three segments: Water Solutions, Crude Oil Logistics, and Liquids Logistics. The Water Solutions segment transports, treats, recycles, and disposes produced and flowback water generated from oil and natural gas production; aggregates and sells recovered crude oil; disposes solids, such as tank bottoms, and drilling fluid and muds, as well as performs truck and frac tank washouts; and sells produced water for reuse and recycle, and brackish non-potable water. The Crude Oil Logistics segment purchases crude oil from producers and marketers, and transports it to refineries for resale at pipeline injection stations, storage terminals, barge loading facilities, rail facilities, refineries, and other trade hubs; and provides storage, terminaling, and transportation services through pipelines. The Liquids Logistics segment supplies natural gas liquids, refined petroleum products, and biodiesel to commercial, retail, and industrial customers in the United States and Canada through its 24 terminals, third-party storage and terminal facilities, and nine common carrier pipelines, as well as through fleet of leased railcars. This segment is also involved in the marine export of butane through its facility located in Chesapeake, Virginia. NGL Energy Holdings LLC serves as the general partner of the company. The company was founded in 1940 and is headquartered in Tulsa, Oklahoma.
About Natural Resource Partners
Natural Resource Partners L.P., together with its subsidiaries, owns, manages, and leases a portfolio of mineral properties in the United States. It operates in two segments, Mineral Rights and Soda Ash. The company owns interests in coal, soda ash, trona, and other natural resources. Its coal reserves are primarily located in the Appalachia Basin, the Illinois Basin, and the Northern Powder River Basin in the United States; industrial minerals and aggregates properties located in the United States; and oil and gas properties located in Louisiana. The company leases a portion of its reserves in exchange for royalty payments; and owns and leases transportation and processing infrastructure related to coal properties. NRP (GP) LP serves as the general partner of the company. Natural Resource Partners L.P. was incorporated in 2002 and is headquartered in Houston, Texas.
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