Comparing Transportadora De Gas Sa Ord B (NYSE:TGS) & Pembina Pipeline (NYSE:PBA)

Transportadora De Gas Sa Ord B (NYSE:TGS) and Pembina Pipeline (NYSE:PBA) are both energy companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.

Profitability

This table compares Transportadora De Gas Sa Ord B and Pembina Pipeline’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Transportadora De Gas Sa Ord B	31.29%	15.52%	10.23%
Pembina Pipeline	23.73%	12.61%	5.37%

Earnings & Valuation

This table compares Transportadora De Gas Sa Ord B and Pembina Pipeline”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Transportadora De Gas Sa Ord B	$1.34 billion	3.07	$407.18 million	$2.51	10.88
Pembina Pipeline	$5.39 billion	4.01	$1.36 billion	$2.21	16.84

Pembina Pipeline has higher revenue and earnings than Transportadora De Gas Sa Ord B. Transportadora De Gas Sa Ord B is trading at a lower price-to-earnings ratio than Pembina Pipeline, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Transportadora De Gas Sa Ord B and Pembina Pipeline, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Transportadora De Gas Sa Ord B	0	0	2	0	3.00
Pembina Pipeline	0	2	5	1	2.88

Transportadora De Gas Sa Ord B presently has a consensus target price of $40.00, suggesting a potential upside of 46.47%. Pembina Pipeline has a consensus target price of $56.00, suggesting a potential upside of 50.50%. Given Pembina Pipeline’s higher probable upside, analysts clearly believe Pembina Pipeline is more favorable than Transportadora De Gas Sa Ord B.

Insider and Institutional Ownership

3.3% of Transportadora De Gas Sa Ord B shares are held by institutional investors. Comparatively, 55.4% of Pembina Pipeline shares are held by institutional investors. 0.1% of Pembina Pipeline shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Transportadora De Gas Sa Ord B has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500. Comparatively, Pembina Pipeline has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500.

Dividends

Transportadora De Gas Sa Ord B pays an annual dividend of $0.93 per share and has a dividend yield of 3.4%. Pembina Pipeline pays an annual dividend of $2.07 per share and has a dividend yield of 5.6%. Transportadora De Gas Sa Ord B pays out 37.1% of its earnings in the form of a dividend. Pembina Pipeline pays out 93.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pembina Pipeline has increased its dividend for 4 consecutive years. Pembina Pipeline is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Pembina Pipeline beats Transportadora De Gas Sa Ord B on 12 of the 18 factors compared between the two stocks.

About Transportadora De Gas Sa Ord B

Transportadora de Gas del Sur S.A. engages in transportation of natural gas, and production and commercialization of natural gas liquids in Argentina and internationally. The company operates through four segments: Natural Gas Transportation Services; Liquids Production and Commercialization; Midstream; and Telecommunications. The Natural Gas Transportation segment transports natural gas through pipeline system to distribution companies, power plants, and industrial customers. It provides operation and maintenance services for the natural gas transportation facilities. The Liquids Production and Commercialization segment produces and commercializes natural gas liquids, such as ethane, liquid petroleum gas, natural gasoline, propane, and butane. This segment offers certain related services comprising reception, storage, and dispatch of the liquids. The Midstream segment provides natural gas conditioning services; treatment, removal of impurities and natural gas compression, including the collection and transport of natural gas; and inspection and maintenance of pipelines and compressor plants services. In addition, this segment offers steam generation for electricity production and management services for expansion works and steam generation for the production of electricity. The Telecommunications segment offers data transmission services through a network of digital terrestrial radio relay. It serves residential, commercial, industrial, and electric power generation end users. The company was incorporated in 1992 and is headquartered in Buenos Aires, Argentina. Transportadora de Gas del Sur S.A. is a subsidiary of Compañía de Inversiones de Energía S.A.

About Pembina Pipeline

Pembina Pipeline Corporation provides energy transportation and midstream services. It operates through three segments: Pipelines, Facilities, and Marketing & New Ventures. The Pipelines segment operates conventional, oil sands and heavy oil, and transmission assets with a transportation capacity of 2.9 millions of barrels of oil equivalent per day, the ground storage capacity of 10 millions of barrels, and rail terminalling capacity of approximately 105 thousands of barrels of oil equivalent per day serving markets and basins across North America. The Facilities segment offers infrastructure that provides customers with natural gas, condensate, and natural gas liquids (NGLs), including ethane, propane, butane, and condensate; and includes 354 thousands of barrels per day of NGL fractionation capacity, 21 millions of barrels of cavern storage capacity, and associated pipeline, and rail terminalling facilities and a liquefied propane export facility. The Marketing & New Ventures segment buys and sells hydrocarbon liquids and natural gas originating in the Western Canadian sedimentary basin and other basins. Pembina Pipeline Corporation was incorporated in 1954 and is headquartered in Calgary, Canada.