Mesa Royalty Trust (NYSE:MTR) & Plains GP (NYSE:PAGP) Critical Comparison
by Michael Walen · The Markets DailyMesa Royalty Trust (NYSE:MTR – Get Free Report) and Plains GP (NYSE:PAGP – Get Free Report) are both energy companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, profitability, institutional ownership, analyst recommendations, valuation, dividends and risk.
Institutional & Insider Ownership
12.7% of Mesa Royalty Trust shares are owned by institutional investors. Comparatively, 88.3% of Plains GP shares are owned by institutional investors. 6.9% of Plains GP shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Mesa Royalty Trust and Plains GP’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Mesa Royalty Trust | 60.59% | 9.17% | 8.82% |
| Plains GP | 0.21% | 0.70% | 0.36% |
Analyst Ratings
This is a breakdown of recent ratings and price targets for Mesa Royalty Trust and Plains GP, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Mesa Royalty Trust | 1 | 0 | 0 | 0 | 1.00 |
| Plains GP | 2 | 6 | 5 | 1 | 2.36 |
Plains GP has a consensus price target of $26.00, suggesting a potential upside of 0.85%. Given Plains GP’s stronger consensus rating and higher possible upside, analysts plainly believe Plains GP is more favorable than Mesa Royalty Trust.
Risk and Volatility
Mesa Royalty Trust has a beta of 0.38, suggesting that its stock price is 62% less volatile than the S&P 500. Comparatively, Plains GP has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500.
Earnings and Valuation
This table compares Mesa Royalty Trust and Plains GP”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Mesa Royalty Trust | $600,000.00 | 5.97 | $510,000.00 | $0.16 | 12.03 |
| Plains GP | $52.30 billion | 0.10 | $103.00 million | $2.79 | 9.24 |
Plains GP has higher revenue and earnings than Mesa Royalty Trust. Plains GP is trading at a lower price-to-earnings ratio than Mesa Royalty Trust, indicating that it is currently the more affordable of the two stocks.
Summary
Plains GP beats Mesa Royalty Trust on 11 of the 15 factors compared between the two stocks.
About Mesa Royalty Trust
Mesa Royalty Trust owns overriding royalty interests in various oil and gas producing properties in the United States. It holds interests in properties located in the Hugoton field of Kansas; and the San Juan Basin field of Northwestern New Mexico and Southwestern Colorado. The company was founded in 1979 and is based in Houston, Texas.
About Plains GP
Plains GP Holdings, L.P., through its subsidiary, Plains All American Pipeline, L.P., owns and operates midstream infrastructure systems in the United States and Canada. It operates in two segments, Crude Oil and Natural Gas Liquids (NGLs). The company engages in the gathering and transporting crude oil and NGLs using pipelines, gathering systems, and trucks. It engages in the loading and unloading services at terminals; NGL fractionation and isomerization services; and natural gas and condensate processing services. The company offers logistics services to producers, refiners, and other customers. PAA GP Holdings LLC operates as a general partner of the company. Plains GP Holdings, L.P. was incorporated in 2013 and is headquartered in Houston, Texas.