Shell (NYSE:SHEL – Get Free Report) and TXO Partners (NYSE:TXO – Get Free Report) are both oils/energy companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, dividends, profitability and risk.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for Shell and TXO Partners, as provided by MarketBeat.
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
Shell | 0 | 2 | 3 | 0 | 2.60 |
TXO Partners | 0 | 0 | 1 | 1 | 3.50 |
Shell currently has a consensus target price of $79.67, suggesting a potential upside of 9.17%. TXO Partners has a consensus target price of $26.00, suggesting a potential upside of 45.99%. Given TXO Partners’ stronger consensus rating and higher possible upside, analysts plainly believe TXO Partners is more favorable than Shell.
Dividends
Institutional & Insider Ownership
28.6% of Shell shares are owned by institutional investors. Comparatively, 27.4% of TXO Partners shares are owned by institutional investors. 1.0% of Shell shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Profitability
This table compares Shell and TXO Partners’ net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
Shell | 5.83% | 13.83% | 6.44% |
TXO Partners | -27.31% | 6.89% | 5.16% |
Volatility & Risk
Shell has a beta of 0.59, suggesting that its stock price is 41% less volatile than the S&P 500. Comparatively, TXO Partners has a beta of -0.18, suggesting that its stock price is 118% less volatile than the S&P 500.
Earnings & Valuation
This table compares Shell and TXO Partners’ top-line revenue, earnings per share and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
Shell | $323.18 billion | 0.73 | $19.36 billion | $5.42 | 13.46 |
TXO Partners | $380.72 million | 1.44 | -$103.99 million | ($3.32) | -5.36 |
Shell has higher revenue and earnings than TXO Partners. TXO Partners is trading at a lower price-to-earnings ratio than Shell, indicating that it is currently the more affordable of the two stocks.
Summary
Shell beats TXO Partners on 12 of the 18 factors compared between the two stocks.
About Shell
Shell plc operates as an energy and petrochemical company Europe, Asia, Oceania, Africa, the United States, and Rest of the Americas. The company operates through Integrated Gas, Upstream, Marketing, Chemicals and Products, and Renewables and Energy Solutions segments. It explores for and extracts crude oil, natural gas, and natural gas liquids; markets and transports oil and gas; produces gas-to-liquids fuels and other products; and operates upstream and midstream infrastructure to deliver gas to market. The company also markets and trades natural gas, liquefied natural gas (LNG), crude oil, electricity, carbon-emission rights; and markets and sells LNG as a fuel for heavy-duty vehicles. In addition, it trades in and refines crude oil and other feed stocks, such as low-carbon fuels, lubricants, bitumen, sulphur, gasoline, diesel, aviation fuel, and marine fuel; produces and sells petrochemicals for industrial use; and manages oil sands activities. Further, the company produces base chemicals comprising ethylene, propylene, and aromatics, as well as intermediate chemicals, such as styrene monomer, propylene oxide, solvents, detergent alcohols, ethylene oxide, and ethylene glycol. Additionally, it generates electricity through wind and solar resources; produces and sells hydrogen; and provides electric vehicle charging services. The company was formerly known as Royal Dutch Shell plc and changed its name to Shell plc in January 2022. Shell plc was founded in 1907 and is headquartered in London, the United Kingdom.
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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