Critical Survey: Hess Midstream Partners (NYSE:HESM) vs. International Seaways (NYSE:INSW)

Hess Midstream Partners (NYSE:HESM) and International Seaways (NYSE:INSW) are both mid-cap energy companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, risk, institutional ownership, dividends, profitability and earnings.

Insider and Institutional Ownership

99.0% of Hess Midstream Partners shares are owned by institutional investors. Comparatively, 67.3% of International Seaways shares are owned by institutional investors. 1.7% of International Seaways shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and price targets for Hess Midstream Partners and International Seaways, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hess Midstream Partners	2	5	1	0	1.88
International Seaways	0	2	5	0	2.71

Hess Midstream Partners presently has a consensus target price of $37.67, indicating a potential downside of 5.48%. International Seaways has a consensus target price of $94.75, indicating a potential downside of 7.33%. Given Hess Midstream Partners’ higher probable upside, equities analysts plainly believe Hess Midstream Partners is more favorable than International Seaways.

Earnings and Valuation

This table compares Hess Midstream Partners and International Seaways”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hess Midstream Partners	$1.62 billion	5.07	$352.90 million	$2.90	13.74
International Seaways	$843.30 million	6.01	$309.26 million	$15.64	6.54

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

Profitability

This table compares Hess Midstream Partners and International Seaways’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hess Midstream Partners	23.23%	92.18%	8.62%
International Seaways	61.98%	31.75%	23.54%

Dividends

Hess Midstream Partners pays an annual dividend of $3.16 per share and has a dividend yield of 7.9%. International Seaways pays an annual dividend of $0.48 per share and has a dividend yield of 0.5%. Hess Midstream Partners pays out 109.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. International Seaways pays out 3.1% of its earnings in the form of a dividend. Hess Midstream Partners has raised its dividend for 8 consecutive years. Hess Midstream Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Hess Midstream Partners has a beta of 0.52, indicating that its share price is 48% less volatile than the S&P 500. Comparatively, International Seaways has a beta of -0.13, indicating that its share price is 113% less volatile than the S&P 500.

Summary

Hess Midstream Partners beats International Seaways on 9 of the 17 factors compared between the two stocks.

About Hess Midstream Partners

Hess Midstream LP owns, develops, operates, and acquires midstream assets and provide fee-based services to Hess and third-party customers in the United States. It operates through three segments: Gathering; Processing and Storage; and Terminaling and Export. The Gathering segment owns natural gas gathering and compression systems; crude oil gathering systems; and produced water gathering and disposal facilities. Its gathering systems consists of approximately 1,410 miles of high and low pressure natural gas and natural gas liquids gathering pipelines with capacity of approximately 660 million cubic feet per day; crude oil gathering system comprises approximately 570 miles of crude oil gathering pipelines; and produced water gathering system that includes approximately 300 miles of pipelines in gathering systems. The Processing and Storage segment comprises Tioga Gas Plant, a natural gas processing and fractionation plant located in Tioga, North Dakota; a 50% interest in the Little Missouri 4 gas processing plant located in south of the Missouri River in McKenzie County, North Dakota; and Mentor Storage Terminal, a propane storage cavern and rail, and truck loading and unloading facility located in Mentor, Minnesota. The Terminaling and Export segment owns Ramberg terminal facility; Tioga rail terminal; crude oil rail cars; and other Dakota access pipeline connections, as well as Johnson's Corner Header System, a crude oil pipeline header system. Hess Midstream LP was founded in 2014 and is based in Houston, Texas.

About International Seaways

International Seaways, Inc. owns and operates a fleet of oceangoing vessels for the transportation of crude oil and petroleum products in the international flag trade. It operates in two segments: Crude Tankers and Product Carriers. As of December 31, 2023, the company owned a fleet of 73 vessels. It serves independent and state-owned oil companies, oil traders, refinery operators, and international government entities. The company was formerly known as OSG International, Inc. and changed its name to International Seaways, Inc. in October 2016. International Seaways, Inc. was incorporated in 1999 and is headquartered in New York, New York.