Analyzing Spire (NYSE:SR) and Suburban Propane Partners (NYSE:SPH)

Suburban Propane Partners (NYSE:SPH) and Spire (NYSE:SR) are both utilities companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.

Dividends

Suburban Propane Partners pays an annual dividend of $1.30 per share and has a dividend yield of 7.4%. Spire pays an annual dividend of $3.30 per share and has a dividend yield of 4.0%. Suburban Propane Partners pays out 66.3% of its earnings in the form of a dividend. Spire pays out 36.8% 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. Spire has increased its dividend for 22 consecutive years.

Profitability

This table compares Suburban Propane Partners and Spire’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Suburban Propane Partners	9.37%	18.57%	5.25%
Spire	21.48%	8.65%	2.21%

Analyst Ratings

This is a breakdown of current ratings for Suburban Propane Partners and Spire, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Suburban Propane Partners	0	1	0	2	3.33
Spire	0	5	5	2	2.75

Spire has a consensus price target of $94.00, indicating a potential upside of 13.01%. Given Spire’s higher probable upside, analysts plainly believe Spire is more favorable than Suburban Propane Partners.

Institutional & Insider Ownership

30.9% of Suburban Propane Partners shares are owned by institutional investors. Comparatively, 87.4% of Spire shares are owned by institutional investors. 1.3% of Suburban Propane Partners shares are owned by insiders. Comparatively, 2.3% of Spire shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Suburban Propane Partners and Spire”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Suburban Propane Partners	$1.39 billion	0.84	$106.57 million	$1.96	8.99
Spire	$2.67 billion	1.84	$271.70 million	$8.97	9.27

Spire has higher revenue and earnings than Suburban Propane Partners. Suburban Propane Partners is trading at a lower price-to-earnings ratio than Spire, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Suburban Propane Partners has a beta of 0.4, indicating that its stock price is 60% less volatile than the S&P 500. Comparatively, Spire has a beta of 0.52, indicating that its stock price is 48% less volatile than the S&P 500.

Summary

Spire beats Suburban Propane Partners on 13 of the 17 factors compared between the two stocks.

About Suburban Propane Partners

Suburban Propane Partners, L.P., through its subsidiaries, engages in the retail marketing and distribution of propane, renewable propane, fuel oil, and refined fuels in the United States. The company operates through four segments: Propane, Fuel Oil and Refined Fuels, Natural Gas and Electricity, and All Other. The Propane segment is involved in the retail distribution of propane for space heating, water heating, cooking, and clothes drying for use as a motor fuel in internal combustion engines to power over-the-road vehicles, forklifts, and stationary engines, as well as to fire furnaces as a cutting gas to the industrial customers; and for tobacco curing, crop drying, poultry brooding, and weed control in the agricultural markets. It also engages in the wholesale distribution of propane to industrial end users. Its Fuel Oil and Refined Fuels segment engages in the retail distribution of fuel oil, diesel, kerosene, and gasoline to residential and commercial customers for use in primarily as a source of heat in homes and buildings. The Natural Gas and Electricity segment markets natural gas and electricity to residential and commercial customers in the deregulated energy markets in New York and Pennsylvania. The All Other segment sells, installs, and services a range of home comfort equipment, including whole-house heating products, air cleaners, humidifiers, and space heaters. The company serves residential, commercial, industrial, and agricultural customers primarily in the east and west coast regions of the United States, as well as portions of the Midwest region of the United States and Alaska. Suburban Propane Partners, L.P. was founded in 1945 and is based in Whippany, New Jersey.

About Spire

Spire Inc., together with its subsidiaries, engages in the purchase, retail distribution, and sale of natural gas to residential, commercial, industrial, and other end-users of natural gas in the United States. The company operates through three segments: Gas Utility, Gas Marketing, and Midstream. It is also involved in the marketing of natural gas and related services; and transportation and storage of natural gas. In addition, the company engages in the operation of propane through its propane pipeline, risk management, and other activities. The company was formerly known as The Laclede Group, Inc. and changed its name to Spire Inc. in April 2016. Spire Inc. was founded in 1857 and is based in Saint Louis, Missouri.