Anadarko Petroleum (NASDAQ:APC – Get Free Report) and Texas Pacific Land (NYSE:TPL – Get Free Report) are both energy companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, institutional ownership and valuation.
Dividends
Anadarko Petroleum pays an annual dividend of $2.00 per share and has a dividend yield of 12.6%. Texas Pacific Land pays an annual dividend of $2.40 per share and has a dividend yield of 0.7%. Anadarko Petroleum pays out 289.9% 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 increased its dividend for 3 consecutive years.
Institutional and Insider Ownership
59.9% of Texas Pacific Land shares are owned by institutional investors. 0.3% of Texas Pacific Land shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Analyst Recommendations
This is a summary of recent ratings for Anadarko Petroleum and Texas Pacific Land, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Anadarko Petroleum | 0 | 2 | 4 | 1 | 2.86 |
| Texas Pacific Land | 0 | 1 | 2 | 0 | 2.67 |
Anadarko Petroleum currently has a consensus target price of $21.80, suggesting a potential upside of 37.37%. Texas Pacific Land has a consensus target price of $639.00, suggesting a potential upside of 88.68%. Given Texas Pacific Land’s higher probable upside, analysts clearly believe Texas Pacific Land is more favorable than Anadarko Petroleum.
Profitability
This table compares Anadarko Petroleum and Texas Pacific Land’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Anadarko Petroleum | N/A | N/A | N/A |
| Texas Pacific Land | 60.32% | 35.76% | 32.04% |
Valuation and Earnings
This table compares Anadarko Petroleum and Texas Pacific Land”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Anadarko Petroleum | $5.58 billion | 0.04 | $32.73 million | $0.69 | 23.00 |
| Texas Pacific Land | $798.19 million | 29.26 | $481.38 million | $7.85 | 43.14 |
Texas Pacific Land has lower revenue, but higher earnings than Anadarko Petroleum. Anadarko Petroleum 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.
Summary
Texas Pacific Land beats Anadarko Petroleum on 12 of the 17 factors compared between the two stocks.
About Anadarko Petroleum
Anadarko Petroleum Corporation engages in the exploration, development, production, and marketing of oil and gas properties. It operates through three segments: Exploration and Production, WES Midstream, and Other Midstream. The company explores for and produces oil, natural gas, and natural gas liquids (NGLs). It is also involved in gathering, processing, treating, and transporting oil, natural-gas, and NGLs production, as well as the gathering and disposal of produced water. The company's oil and natural gas properties are located in the United States onshore and deepwater Gulf of Mexico; and Algeria, Ghana, Mozambique, Colombia, Peru, and other countries. As of December 31, 2018, it had approximately 1.5 billion barrels of oil equivalent of proved reserves. The company was founded in 1959 and is headquartered in The Woodlands, Texas.
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.
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