Alon USA Partners (NYSE: ALDW) and Exxon Mobil (NYSE:XOM) are both oils/energy companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, dividends, valuation, earnings, risk, analyst recommendations and profitability.
Earnings and Valuation
This table compares Alon USA Partners and Exxon Mobil’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Alon USA Partners||$1.81 billion||0.54||-$4.40 million||$1.15||13.55|
|Exxon Mobil||$226.09 billion||1.53||$7.84 billion||$3.07||26.52|
Exxon Mobil has higher revenue and earnings than Alon USA Partners. Alon USA Partners is trading at a lower price-to-earnings ratio than Exxon Mobil, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent recommendations and price targets for Alon USA Partners and Exxon Mobil, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Alon USA Partners||0||2||4||0||2.67|
Alon USA Partners currently has a consensus price target of $12.25, suggesting a potential downside of 21.37%. Exxon Mobil has a consensus price target of $86.10, suggesting a potential upside of 5.74%. Given Exxon Mobil’s higher probable upside, analysts plainly believe Exxon Mobil is more favorable than Alon USA Partners.
This table compares Alon USA Partners and Exxon Mobil’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Alon USA Partners||3.47%||28.83%||7.77%|
Institutional and Insider Ownership
5.1% of Alon USA Partners shares are owned by institutional investors. Comparatively, 50.8% of Exxon Mobil shares are owned by institutional investors. 0.1% of Exxon Mobil shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Volatility & Risk
Alon USA Partners has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500. Comparatively, Exxon Mobil has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500.
Alon USA Partners pays an annual dividend of $1.40 per share and has a dividend yield of 9.0%. Exxon Mobil pays an annual dividend of $3.08 per share and has a dividend yield of 3.8%. Alon USA Partners pays out 121.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Exxon Mobil pays out 100.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alon USA Partners has increased its dividend for 34 consecutive years and Exxon Mobil has increased its dividend for 2 consecutive years. Alon USA Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Exxon Mobil beats Alon USA Partners on 12 of the 18 factors compared between the two stocks.
Alon USA Partners Company Profile
Alon USA Partners, LP (Alon) is engaged principally in the business of operating a crude oil refinery in Big Spring, Texas. The Company had a crude oil throughput capacity of 73,000 barrels per day, which the Company referred to as its Big Spring refinery, as of December 31, 2016. The Company refines crude oil into finished products, which the Company markets primarily in Central and West Texas, Oklahoma, New Mexico and Arizona through its integrated wholesale distribution network to retail convenience stores and other third-party distributors. Its Big Spring refinery is located on 1,306 acres in the Permian Basin in West Texas. Major processes at its Big Spring refinery include fluid catalytic cracking, naphtha reforming, vacuum distillation, hydrotreating, aromatic extraction and alkylation. The Company is managed and operated by Alon USA Partners GP, LLC (General Partner), an indirect subsidiary of Alon USA Energy, Inc. (Alon Energy), which is its parent company.
Exxon Mobil Company Profile
Exxon Mobil Corporation is engaged in energy business. The Company is engaged in the exploration, production, transportation and sale of crude oil and natural gas, and the manufacture, transportation and sale of petroleum products. The Company also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and a range of specialty products. The Company’s segments include Upstream, Downstream, Chemical, and Corporate and Financing. The Upstream segment operates to explore for and produce crude oil and natural gas. The Downstream operates to manufacture and sell petroleum products. The Chemical segment operates to manufacture and sell petrochemicals. The Company has exploration and development activities in projects located in the United States, Canada/South America, Europe, Africa, Asia and Australia/Oceania.
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