Antero Midstream (NYSE:AM – Get Free Report) and Pembina Pipeline (NYSE:PBA – Get Free Report) are both large-cap energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, dividends, risk, earnings, profitability and valuation.
Dividends
Antero Midstream pays an annual dividend of $0.90 per share and has a dividend yield of 4.1%. Pembina Pipeline pays an annual dividend of $2.13 per share and has a dividend yield of 4.5%. Antero Midstream pays out 107.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pembina Pipeline pays out 104.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pembina Pipeline has raised its dividend for 4 consecutive years. Pembina Pipeline is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider & Institutional Ownership
54.0% of Antero Midstream shares are owned by institutional investors. Comparatively, 55.4% of Pembina Pipeline shares are owned by institutional investors. 1.1% of Antero Midstream shares are owned by insiders. Comparatively, 0.1% of Pembina Pipeline shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Antero Midstream | 0 | 5 | 1 | 0 | 2.17 |
| Pembina Pipeline | 0 | 4 | 5 | 0 | 2.56 |
Antero Midstream currently has a consensus target price of $24.50, suggesting a potential upside of 10.94%. Pembina Pipeline has a consensus target price of $64.00, suggesting a potential upside of 33.85%. Given Pembina Pipeline’s stronger consensus rating and higher possible upside, analysts clearly believe Pembina Pipeline is more favorable than Antero Midstream.
Profitability
This table compares Antero Midstream and Pembina Pipeline’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Antero Midstream | 32.41% | 20.19% | 6.56% |
| Pembina Pipeline | 22.41% | 11.41% | 4.82% |
Earnings & Valuation
This table compares Antero Midstream and Pembina Pipeline”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Antero Midstream | $1.19 billion | 8.82 | $413.16 million | $0.84 | 26.29 |
| Pembina Pipeline | $5.57 billion | 5.00 | $1.21 billion | $2.04 | 23.44 |
Pembina Pipeline has higher revenue and earnings than Antero Midstream. Pembina Pipeline is trading at a lower price-to-earnings ratio than Antero Midstream, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Antero Midstream has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500. Comparatively, Pembina Pipeline has a beta of 0.58, suggesting that its share price is 42% less volatile than the S&P 500.
Summary
Pembina Pipeline beats Antero Midstream on 10 of the 17 factors compared between the two stocks.
About Antero Midstream
Antero Midstream Corporation owns, operates, and develops midstream energy assets in the Appalachian Basin. It operates in two segments, Gathering and Processing, and Water Handling. The Gathering and Processing segment includes a network of gathering pipelines and compressor stations that collects and processes production from Antero Resources' wells in West Virginia and Ohio. The Water Handling segment delivers fresh water from sources, including the Ohio River, local reservoirs, and various regional waterways; uses water handling systems to transport flowback and produced water; and offers pumping stations, water storage, and blending facilities. The company was founded in 2002 and is headquartered in Denver, Colorado.
About Pembina Pipeline
Pembina Pipeline Corporation provides energy transportation and midstream services. It operates through three segments: Pipelines, Facilities, and Marketing & New Ventures. The Pipelines segment operates conventional, oil sands and heavy oil, and transmission assets with a transportation capacity of 2.9 millions of barrels of oil equivalent per day, the ground storage capacity of 10 millions of barrels, and rail terminalling capacity of approximately 105 thousands of barrels of oil equivalent per day serving markets and basins across North America. The Facilities segment offers infrastructure that provides customers with natural gas, condensate, and natural gas liquids (NGLs), including ethane, propane, butane, and condensate; and includes 354 thousands of barrels per day of NGL fractionation capacity, 21 millions of barrels of cavern storage capacity, and associated pipeline, and rail terminalling facilities and a liquefied propane export facility. The Marketing & New Ventures segment buys and sells hydrocarbon liquids and natural gas originating in the Western Canadian sedimentary basin and other basins. Pembina Pipeline Corporation was incorporated in 1954 and is headquartered in Calgary, Canada.
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