Critical Analysis: Cheniere Energy Partners (CQP) vs. Its Rivals

Cheniere Energy Partners (NYSE:CQP) is one of 23 public companies in the “Natural gas distribution” industry, but how does it compare to its peers? We will compare Cheniere Energy Partners to similar companies based on the strength of its institutional ownership, profitability, valuation, dividends, analyst recommendations, earnings and risk.

Volatility & Risk

Cheniere Energy Partners has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500. Comparatively, Cheniere Energy Partners’ peers have a beta of 0.86, meaning that their average stock price is 14% less volatile than the S&P 500.

Earnings & Valuation

This table compares Cheniere Energy Partners and its peers gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Cheniere Energy Partners	$8.93 billion	$4.25 billion	11.78
Cheniere Energy Partners Competitors	$9.11 billion	$1.14 billion	18.84

Cheniere Energy Partners’ peers have higher revenue, but lower earnings than Cheniere Energy Partners. Cheniere Energy Partners is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings for Cheniere Energy Partners and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cheniere Energy Partners	1	0	0	0	1.00
Cheniere Energy Partners Competitors	424	1041	871	36	2.22

Cheniere Energy Partners presently has a consensus target price of $46.00, indicating a potential downside of 15.69%. As a group, “Natural gas distribution” companies have a potential upside of 6.03%. Given Cheniere Energy Partners’ peers stronger consensus rating and higher possible upside, analysts plainly believe Cheniere Energy Partners has less favorable growth aspects than its peers.

Profitability

This table compares Cheniere Energy Partners and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cheniere Energy Partners	31.28%	-328.60%	13.93%
Cheniere Energy Partners Competitors	1.82%	-15.64%	0.53%

Institutional and Insider Ownership

46.5% of Cheniere Energy Partners shares are held by institutional investors. Comparatively, 58.2% of shares of all “Natural gas distribution” companies are held by institutional investors. 14.1% of shares of all “Natural gas distribution” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Dividends

Cheniere Energy Partners pays an annual dividend of $3.10 per share and has a dividend yield of 5.7%. Cheniere Energy Partners pays out 67.0% of its earnings in the form of a dividend. As a group, “Natural gas distribution” companies pay a dividend yield of 2.8% and pay out 48.2% of their earnings in the form of a dividend.

Summary

Cheniere Energy Partners peers beat Cheniere Energy Partners on 11 of the 15 factors compared.

Cheniere Energy Partners Company Profile

Cheniere Energy Partners, L.P., through its subsidiaries, provides liquefied natural gas (LNG) to integrated energy companies, utilities, and energy trading companies worldwide. The company owns and operates natural gas liquefaction and export facility at the Sabine Pass LNG Terminal located in Cameron Parish, Louisiana. It also owns a natural gas supply pipeline that interconnects the Sabine Pass LNG terminal with various interstate pipelines. The company was founded in 2003 and is headquartered in Houston, Texas. Cheniere Energy Partners, L.P. is a subsidiary of Cheniere Energy, Inc.