Head to Head Comparison: Hess Corporation (HES) versus Cenovus Energy (CVE)
Hess Corporation (NYSE: HES) and Cenovus Energy (NYSE:CVE) are both mid-cap oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, dividends, profitability, earnings and valuation.
Volatility and Risk
Hess Corporation has a beta of 1.74, meaning that its stock price is 74% more volatile than the S&P 500. Comparatively, Cenovus Energy has a beta of 0.57, meaning that its stock price is 43% less volatile than the S&P 500.
Earnings & Valuation
This table compares Hess Corporation and Cenovus Energy’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Hess Corporation||$4.94 billion||2.62||$1.45 billion||($19.30)||-2.11|
|Cenovus Energy||$11.93 billion||0.79||$1.77 billion||$1.80||4.24|
Cenovus Energy has higher revenue and earnings than Hess Corporation. Hess Corporation is trading at a lower price-to-earnings ratio than Cenovus Energy, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
86.3% of Hess Corporation shares are owned by institutional investors. Comparatively, 55.8% of Cenovus Energy shares are owned by institutional investors. 11.8% of Hess Corporation shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Hess Corporation and Cenovus Energy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Hess Corporation pays an annual dividend of $1.00 per share and has a dividend yield of 2.5%. Cenovus Energy pays an annual dividend of $0.15 per share and has a dividend yield of 2.0%. Hess Corporation pays out -5.2% of its earnings in the form of a dividend. Cenovus Energy pays out 8.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Hess Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a summary of recent ratings and target prices for Hess Corporation and Cenovus Energy, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Hess Corporation presently has a consensus price target of $54.06, indicating a potential upside of 32.84%. Cenovus Energy has a consensus price target of $18.64, indicating a potential upside of 144.02%. Given Cenovus Energy’s higher probable upside, analysts clearly believe Cenovus Energy is more favorable than Hess Corporation.
Cenovus Energy beats Hess Corporation on 8 of the 14 factors compared between the two stocks.
About Hess Corporation
Hess Corporation is an exploration and production company. The Company is engaged in exploration, development, production, transportation, purchase and sale of crude oil, natural gas liquids (NGL) and natural gas. The Company’s segments include Exploration and Production, and Bakken Midstream. Its Exploration and Production segment explores for, develops, produces, purchases and sells crude oil, NGLs and natural gas with production operations primarily in the United States, Denmark, Equatorial Guinea, the Malaysia/Thailand Joint Development Area (JDA), Malaysia and Norway. The Bakken Midstream segment provides fee-based services, including crude oil and natural gas gathering, processing of natural gas and the fractionation of NGLs, transportation of crude oil by rail car, terminaling and loading crude oil and NGLs, and the storage and terminaling of propane, primarily in the Bakken shale play of North Dakota.
About Cenovus Energy
Cenovus Energy Inc is a Canada-based integrated oil company. It operates in the business of developing, producing and marketing crude oil, Natural Gas Liquids (NGLs) and natural gas in Canada. The Company also conducts marketing activities and owns refining interests in the United States (U.S.). Its segments include: Oil Sands, which includes the development and production of bitumen and natural gas in northeast Alberta; Conventional, which includes the development and production of conventional crude oil, NGLs and natural gas in Alberta and Saskatchewan, including the heavy oil assets at Pelican Lake, the carbon dioxide (CO2) enhanced oil recovery (EOR) project at Weyburn and emerging tight oil opportunities; Refining and Marketing, which includes transporting and selling crude oil and natural gas and joint ownership of refineries in the U.S., as well as Corporate and Eliminations.
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