Murphy Oil (NYSE:MUR – Get Free Report) and Plains GP (NYSE:PAGP – Get Free Report) are both mid-cap energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, valuation, risk, institutional ownership, profitability and dividends.
Profitability
This table compares Murphy Oil and Plains GP’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Murphy Oil | 14.90% | 8.51% | 4.48% |
| Plains GP | 0.21% | 0.70% | 0.36% |
Dividends
Murphy Oil pays an annual dividend of $1.40 per share and has a dividend yield of 3.8%. Plains GP pays an annual dividend of $1.67 per share and has a dividend yield of 6.5%. Murphy Oil pays out 43.6% of its earnings in the form of a dividend. Plains GP pays out 59.9% 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. Murphy Oil has raised its dividend for 5 consecutive years.
Analyst Recommendations
This is a breakdown of recent recommendations for Murphy Oil and Plains GP, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Murphy Oil | 2 | 8 | 4 | 1 | 2.27 |
| Plains GP | 2 | 6 | 5 | 1 | 2.36 |
Murphy Oil currently has a consensus price target of $39.75, suggesting a potential upside of 8.32%. Plains GP has a consensus price target of $26.00, suggesting a potential upside of 1.26%. Given Murphy Oil’s higher possible upside, equities analysts plainly believe Murphy Oil is more favorable than Plains GP.
Insider & Institutional Ownership
78.3% of Murphy Oil shares are held by institutional investors. Comparatively, 88.3% of Plains GP shares are held by institutional investors. 5.8% of Murphy Oil shares are held by company insiders. Comparatively, 6.9% of Plains GP shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Murphy Oil and Plains GP”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Murphy Oil | $3.12 billion | 1.69 | $104.23 million | $3.21 | 11.43 |
| Plains GP | $52.30 billion | 0.10 | $103.00 million | $2.79 | 9.20 |
Murphy Oil has higher earnings, but lower revenue than Plains GP. Plains GP is trading at a lower price-to-earnings ratio than Murphy Oil, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Murphy Oil has a beta of 0.52, suggesting that its stock price is 48% less volatile than the S&P 500. Comparatively, Plains GP has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500.
Summary
Murphy Oil beats Plains GP on 9 of the 17 factors compared between the two stocks.
About Murphy Oil
Murphy Oil Corporation, together with its subsidiaries, operates as an oil and gas exploration and production company in the United States, Canada, and internationally. It explores for and produces crude oil, natural gas, and natural gas liquids. The company was formerly known as Murphy Corporation and changed its name to Murphy Oil Corporation in 1964. The company was incorporated in 1950 and is headquartered in Houston, Texas.
About Plains GP
Plains GP Holdings, L.P., through its subsidiary, Plains All American Pipeline, L.P., owns and operates midstream infrastructure systems in the United States and Canada. It operates in two segments, Crude Oil and Natural Gas Liquids (NGLs). The company engages in the gathering and transporting crude oil and NGLs using pipelines, gathering systems, and trucks. It engages in the loading and unloading services at terminals; NGL fractionation and isomerization services; and natural gas and condensate processing services. The company offers logistics services to producers, refiners, and other customers. PAA GP Holdings LLC operates as a general partner of the company. Plains GP Holdings, L.P. was incorporated in 2013 and is headquartered in Houston, Texas.
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