Alon USA Partners, (NYSE: ALDW) and Arc Logistic Partners (NYSE:ARCX) are both small-cap oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, analyst recommendations, dividends, profitabiliy and risk.
Dividends
Alon USA Partners, pays an annual dividend of $1.52 per share and has a dividend yield of 12.5%. Arc Logistic Partners pays an annual dividend of $1.76 per share and has a dividend yield of 11.8%. Alon USA Partners, pays out 214.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Arc Logistic Partners pays out 225.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Alon USA Partners, has raised its dividend for 2 consecutive years and Arc Logistic Partners has raised its dividend for 2 consecutive years. Alon USA Partners, is clearly the better dividend stock, given its higher yield and lower payout ratio.
Valuation & Earnings
This table compares Alon USA Partners, and Arc Logistic Partners’ revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Alon USA Partners, | $2.04 billion | 0.37 | $136.09 million | $0.71 | 17.13 |
| Arc Logistic Partners | $105.24 million | 2.78 | $53.31 million | $0.78 | 19.19 |
Alon USA Partners, has higher revenue and earnings than Arc Logistic Partners. Alon USA Partners, is trading at a lower price-to-earnings ratio than Arc Logistic Partners, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for Alon USA Partners, and Arc Logistic Partners, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Alon USA Partners, | 0 | 2 | 3 | 0 | 2.60 |
| Arc Logistic Partners | 0 | 2 | 1 | 0 | 2.33 |
Alon USA Partners, presently has a consensus price target of $12.25, indicating a potential upside of 0.74%. Arc Logistic Partners has a consensus price target of $18.00, indicating a potential upside of 20.24%. Given Arc Logistic Partners’ higher probable upside, analysts clearly believe Arc Logistic Partners is more favorable than Alon USA Partners,.
Insider and Institutional Ownership
6.8% of Alon USA Partners, shares are owned by institutional investors. Comparatively, 43.1% of Arc Logistic Partners shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Risk & Volatility
Alon USA Partners, has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500. Comparatively, Arc Logistic Partners has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500.
Profitability
This table compares Alon USA Partners, and Arc Logistic Partners’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Alon USA Partners, | 2.20% | 40.06% | 5.91% |
| Arc Logistic Partners | 14.48% | 4.38% | 2.48% |
Summary
Alon USA Partners, beats Arc Logistic Partners on 9 of the 15 factors compared between the two stocks.
Alon USA Partners, Company Profile
Alon USA Partners, LP (Alon) is engaged principally in the business of operating a crude oil refinery in Big Spring, Texas. The Company had a crude oil throughput capacity of 73,000 barrels per day, which the Company referred to as its Big Spring refinery, as of December 31, 2016. The Company refines crude oil into finished products, which the Company markets primarily in Central and West Texas, Oklahoma, New Mexico and Arizona through its integrated wholesale distribution network to retail convenience stores and other third-party distributors. Its Big Spring refinery is located on 1,306 acres in the Permian Basin in West Texas. Major processes at its Big Spring refinery include fluid catalytic cracking, naphtha reforming, vacuum distillation, hydrotreating, aromatic extraction and alkylation. The Company is managed and operated by Alon USA Partners GP, LLC (General Partner), an indirect subsidiary of Alon USA Energy, Inc. (Alon Energy), which is its parent company.
Arc Logistic Partners Company Profile
Arc Logistics Partners LP owns, operates, develops and acquires a portfolio of energy logistics assets. The Company is engaged in the terminaling, storage, throughput and transloading of crude oil and petroleum products. The Company is focused on growing its business through the optimization, organic development and acquisition of terminaling, storage, rail, pipeline and other energy logistics assets. As of March 6, 2017, the Company’s energy logistics assets were located in the East Coast, Gulf Coast, Midwest, Rocky Mountains and West Coast regions of the United States and supplied a group of third-party customers, including oil companies, independent refiners, crude oil and petroleum product marketers, distributors and various industrial manufacturers. As of December 31, 2016, its assets consisted of 21 terminals in 12 states; four rail transloading facilities, and the liquefied natural gas (LNG) Interest in connection with the LNG Facility.
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