Hess Midstream Partners (NYSE:HESM – Get Free Report) and TXO Partners (NYSE:TXO – Get Free Report) are both energy companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.
Insider & Institutional Ownership
99.0% of Hess Midstream Partners shares are held by institutional investors. Comparatively, 27.4% of TXO Partners shares are held by institutional investors. 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
This is a summary of recent ratings for Hess Midstream Partners and TXO Partners, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Hess Midstream Partners | 0 | 2 | 3 | 0 | 2.60 |
| TXO Partners | 0 | 0 | 1 | 0 | 3.00 |
Valuation and Earnings
This table compares Hess Midstream Partners and TXO Partners”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 | $1.50 billion | 5.55 | $223.10 million | $2.55 | 15.09 |
| TXO Partners | $282.81 million | 2.33 | $23.50 million | $0.42 | 37.95 |
Hess Midstream Partners has higher revenue and earnings than TXO Partners. Hess Midstream Partners is trading at a lower price-to-earnings ratio than TXO Partners, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Hess Midstream Partners and TXO Partners’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Hess Midstream Partners | 16.43% | 54.89% | 6.02% |
| TXO Partners | 5.22% | 3.89% | 2.41% |
Risk and Volatility
Hess Midstream Partners has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500. Comparatively, TXO Partners has a beta of 0.08, indicating that its share price is 92% less volatile than the S&P 500.
Dividends
Hess Midstream Partners pays an annual dividend of $2.84 per share and has a dividend yield of 7.4%. TXO Partners pays an annual dividend of $2.44 per share and has a dividend yield of 15.3%. Hess Midstream Partners pays out 111.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. TXO Partners pays out 581.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hess Midstream Partners has raised its dividend for 8 consecutive years and TXO Partners has raised its dividend for 1 consecutive years.
Summary
Hess Midstream Partners beats TXO Partners on 12 of the 16 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 TXO Partners
TXO Partners, L.P., an oil and natural gas company, focuses on the acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquid reserves in North America. Its acreage positions are concentrated in the Permian Basin of West Texas and New Mexico and the San Juan Basin of New Mexico and Colorado. The company was formerly known as TXO Energy Partners, L.P. and changed its name to TXO Partners, L.P. in May 2023. TXO Partners, L.P. was incorporated in 2012 and is based in Fort Worth, Texas.
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