Contrasting Southwest Gas Corporation (SWX) and Regency Energy Partners (RGNC)

Southwest Gas Corporation (NYSE: SWX) and Regency Energy Partners (NASDAQ:RGNC) are both utilities companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, profitabiliy, dividends, analyst recommendations, valuation, risk and institutional ownership.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Southwest Gas Corporation and Regency Energy Partners, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southwest Gas Corporation	0	3	0	0	2.00
Regency Energy Partners	0	0	0	0	N/A

Southwest Gas Corporation currently has a consensus target price of $79.00, indicating a potential downside of 1.70%. Given Southwest Gas Corporation’s higher possible upside, analysts plainly believe Southwest Gas Corporation is more favorable than Regency Energy Partners.

Earnings and Valuation

This table compares Southwest Gas Corporation and Regency Energy Partners’ revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Southwest Gas Corporation	$2.38 billion	1.61	$567.36 million	$3.06	26.26
Regency Energy Partners	N/A	N/A	N/A	N/A	N/A

Southwest Gas Corporation has higher revenue and earnings than Regency Energy Partners.

Dividends

Southwest Gas Corporation pays an annual dividend of $1.98 per share and has a dividend yield of 2.5%. Regency Energy Partners does not pay a dividend. Southwest Gas Corporation pays out 64.7% of its earnings in the form of a dividend. Regency Energy Partners has increased its dividend for 5 consecutive years.

Profitability

This table compares Southwest Gas Corporation and Regency Energy Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southwest Gas Corporation	6.12%	8.65%	2.61%
Regency Energy Partners	-0.30%	-0.47%	-0.07%

Institutional & Insider Ownership

78.4% of Southwest Gas Corporation shares are held by institutional investors. 1.3% of Southwest Gas Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

Southwest Gas Corporation beats Regency Energy Partners on 8 of the 10 factors compared between the two stocks.

About Southwest Gas Corporation

Southwest Gas Holdings, Inc., formerly Southwest Gas Corporation, is engaged in the business of purchasing, distributing and transporting natural gas. The Company operates through two segments: natural gas operations and construction services, which includes the operations of the Company’s subsidiary, Centuri Construction Group, Inc. (Centuri). The Company operates two pipeline transmission systems, such as a system, which includes a liquefied natural gas (LNG) storage facility owned by Paiute extending from the Idaho-Nevada border to the Reno, Sparks, and Carson City areas and communities in the Lake Tahoe area in both California and Nevada and other communities in northern and western Nevada, and a system extending from the Colorado River at the southern tip of Nevada to the Las Vegas distribution area.

About Regency Energy Partners

Regency Energy Partners LP gathers and processes, compress, treats and transports natural gas; transports, fractionates and stores natural gas liquids (NGLs); gathers, transports and terminals oil received from producers; gathers and disposes salt water, and manages coal and natural resource properties in the United States. The Company has six business segments: Gathering and Processing, Natural Gas Transportation, NGL Services, Contract Services, Natural Resources and Corporate. The Gathering and Processing segment provides wellhead-to-market services to producers of natural gas. The Natural Gas Transportation segment owns a 49.99% general partner interest in RIGS Haynesville Partnership Co. The NGL Services segment owns a 30% membership interest in Lone Star NGL LLC. The Contract Services segment owns and operates a fleet of compressors. The Natural Resources segment manages coal and natural resources properties. The Corporate segment includes its corporate assets.