South Bow (NYSE:SOBO) & Pembina Pipeline (NYSE:PBA) Head-To-Head Contrast

Pembina Pipeline (NYSE:PBA) and South Bow (NYSE:SOBO) are both energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Valuation & Earnings

This table compares Pembina Pipeline and South Bow”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pembina Pipeline	$8.06 billion	2.64	$1.36 billion	$2.13	17.23
South Bow	$2.12 billion	2.72	$316.00 million	$1.85	14.95

Pembina Pipeline has higher revenue and earnings than South Bow. South Bow is trading at a lower price-to-earnings ratio than Pembina Pipeline, indicating that it is currently the more affordable of the two stocks.

Dividends

Pembina Pipeline pays an annual dividend of $2.04 per share and has a dividend yield of 5.6%. South Bow pays an annual dividend of $2.00 per share and has a dividend yield of 7.2%. Pembina Pipeline pays out 95.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. South Bow pays out 108.1% 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.

Profitability

This table compares Pembina Pipeline and South Bow’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pembina Pipeline	23.24%	12.27%	5.22%
South Bow	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Pembina Pipeline and South Bow, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pembina Pipeline	1	2	6	1	2.70
South Bow	2	8	1	2	2.23

Pembina Pipeline presently has a consensus target price of $56.00, indicating a potential upside of 52.63%. South Bow has a consensus target price of $29.00, indicating a potential upside of 4.84%. Given Pembina Pipeline’s stronger consensus rating and higher possible upside, equities analysts clearly believe Pembina Pipeline is more favorable than South Bow.

Institutional and Insider Ownership

55.4% of Pembina Pipeline shares are owned by institutional investors. 0.1% of Pembina Pipeline shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Pembina Pipeline beats South Bow on 14 of the 17 factors compared between the two stocks.

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.

About South Bow

South Bow Corp is a strategic liquids pipeline company. It is a new liquids-focused midstream infrastructure company. South Bow Corp is based in Canada.