Contrasting Keyera (OTCMKTS:KEYUF) and Golar LNG (NASDAQ:GLNG)

Keyera (OTCMKTS:KEYUF) and Golar LNG (NASDAQ:GLNG) are both energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, earnings, dividends and risk.

Dividends

Keyera pays an annual dividend of $2.48 per share and has a dividend yield of 8.2%. Golar LNG pays an annual dividend of $1.00 per share and has a dividend yield of 3.1%. Keyera pays out 85.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Golar LNG pays out 95.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Keyera is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Keyera and Golar LNG”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Keyera	N/A	N/A	N/A	$2.91	10.35
Golar LNG	$276.58 million	12.26	-$46.79 million	$1.05	30.88

Keyera has higher earnings, but lower revenue than Golar LNG. Keyera is trading at a lower price-to-earnings ratio than Golar LNG, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Keyera and Golar LNG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Keyera	N/A	N/A	N/A
Golar LNG	50.89%	9.20%	5.97%

Institutional & Insider Ownership

37.0% of Keyera shares are held by institutional investors. Comparatively, 92.2% of Golar LNG shares are held by institutional investors. 0.0% of Golar LNG shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for Keyera and Golar LNG, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Keyera	0	0	1	0	3.00
Golar LNG	0	1	4	0	2.80

Keyera currently has a consensus price target of $35.00, indicating a potential upside of 16.36%. Golar LNG has a consensus price target of $45.10, indicating a potential upside of 39.11%. Given Golar LNG’s higher probable upside, analysts plainly believe Golar LNG is more favorable than Keyera.

Summary

Golar LNG beats Keyera on 9 of the 13 factors compared between the two stocks.

About Keyera

Keyera Corp. engages in the gathering and processing of natural gas; and transportation, storage, and marketing of natural gas liquids (NGLs) in Canada and the United States. It operates through three segments: Gathering and Processing, Liquids Infrastructure, and Marketing. The Gathering and Processing segment owns and operates raw gas gathering pipelines and processing plants, which collect and process raw natural gas, remove waste products, and separate the economic components primarily natural gas liquids; and provides gas handling and other ancillary services, such as NGL extraction, NGL handling and loading services, and condensate stabilization services. The Liquids Infrastructure segment owns and operates a network of facilities, including underground NGL storage caverns, above ground storage tanks, NGL fractionation facilities, and NGL and condensate pipelines, as well as rail and truck terminals for the processing, fractionation, storage, and transportation of by-products of natural gas processing comprising ethane, propane, butane, and condensate. This segment also produces iso-octane; and engages in the liquids blending activities. The Marketing segment engages in the marketing of propane, butane, condensate, and iso-octane, as well as natural gas and crude oil. The company was formerly known as Keyera Facilities Income Fund and changed its name to Keyera Corp. in January 2011. Keyera Corp. was founded in 1998 and is headquartered in Calgary, Canada.

About Golar LNG

Golar LNG Limited designs, converts, owns, and operates marine infrastructure for the liquefaction of natural gas. The company operates through three segments: FLNG, Corporate and Other, and Shipping. It engages in the regasification, storage, and offloading of liquefied natural gas (LNG); operation of floating liquefaction natural gas (FLNG) vessels or projects; transportation of LNG carriers; and vessel management activities. Golar LNG Limited was founded in 1946 and is headquartered in Hamilton, Bermuda.