Comparing Western Midstream Partners (NYSE:WES) and CrossAmerica Partners (NYSE:CAPL)

CrossAmerica Partners (NYSE:CAPL) and Western Midstream Partners (NYSE:WES) are both energy companies, but which is the better stock? We will compare the two companies based on the strength of their risk, profitability, earnings, institutional ownership, analyst recommendations, valuation and dividends.

Profitability

This table compares CrossAmerica Partners and Western Midstream Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CrossAmerica Partners	0.80%	-45.12%	2.37%
Western Midstream Partners	35.79%	38.52%	10.25%

Dividends

CrossAmerica Partners pays an annual dividend of $2.10 per share and has a dividend yield of 10.1%. Western Midstream Partners pays an annual dividend of $3.64 per share and has a dividend yield of 9.4%. CrossAmerica Partners pays out 262.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Midstream Partners pays out 108.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Midstream Partners has increased its dividend for 5 consecutive years.

Volatility & Risk

CrossAmerica Partners has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, Western Midstream Partners has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for CrossAmerica Partners and Western Midstream Partners, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CrossAmerica Partners	0	0	0	0	0.00
Western Midstream Partners	2	3	1	0	1.83

Western Midstream Partners has a consensus target price of $39.83, indicating a potential upside of 2.73%. Given Western Midstream Partners’ stronger consensus rating and higher possible upside, analysts plainly believe Western Midstream Partners is more favorable than CrossAmerica Partners.

Valuation and Earnings

This table compares CrossAmerica Partners and Western Midstream Partners”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CrossAmerica Partners	$4.02 billion	0.20	$19.89 million	$0.80	25.93
Western Midstream Partners	$3.61 billion	4.10	$1.57 billion	$3.35	11.57

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

Insider and Institutional Ownership

24.1% of CrossAmerica Partners shares are owned by institutional investors. Comparatively, 84.8% of Western Midstream Partners shares are owned by institutional investors. 52.0% of CrossAmerica Partners shares are owned by insiders. Comparatively, 0.0% of Western Midstream Partners shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Western Midstream Partners beats CrossAmerica Partners on 13 of the 17 factors compared between the two stocks.

About CrossAmerica Partners

CrossAmerica Partners LP engages in the wholesale distribution of motor fuels, operation of convenience stores, and ownership and leasing of real estate used in the retail distribution of motor fuels in the United States. It operates in two segments, Wholesale and Retail. The Wholesale segment engages in the wholesale distribution of motor fuels to lessee dealers, independent dealers, commission agents, and company operated retail sites. The Retail segment is involved in the sale of convenience merchandise items; and retail sale of motor fuels at company operated retail sites and retail sites operated by commission agents. CrossAmerica GP LLC operates as the general partner of the company. The company was formerly known as Lehigh Gas Partners LP and changed its name to CrossAmerica Partners LP in October 2014. The company was founded in 1992 and is based in Allentown, Pennsylvania.

About Western Midstream Partners

Western Midstream Partners, LP, together with its subsidiaries, operates as a midstream energy company primarily in the United States. It is involved in gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural gas liquids (NGLs), and crude oil; and gathering and disposing produced water. The company also buys and sells natural gas, NGLs, and condensate. It operates assets located in Texas, New Mexico, the Rocky Mountains, and North-central Pennsylvania. Western Midstream Holdings, LLC operates as the general partner of the company. The company was formerly known as Western Gas Equity Partners, LP and changed its name to Western Midstream Partners, LP in February 2019. Western Midstream Partners, LP was incorporated in 2007 and is based in The Woodlands, Texas.