Financial Analysis: Ecopetrol (EC) & TotalFinaElf, (TOT)
Ecopetrol (NYSE: EC) and TotalFinaElf, (NYSE:TOT) are both large-cap oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, dividends, analyst recommendations and profitability.
Valuation and Earnings
This table compares Ecopetrol and TotalFinaElf,’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ecopetrol||$17.94 billion||1.08||$6.95 billion||$0.44||21.48|
|TotalFinaElf,||$139.27 billion||0.96||$21.80 billion||$2.91||18.51|
TotalFinaElf, has higher revenue and earnings than Ecopetrol. TotalFinaElf, is trading at a lower price-to-earnings ratio than Ecopetrol, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
2.1% of Ecopetrol shares are owned by institutional investors. Comparatively, 5.4% of TotalFinaElf, shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
This is a breakdown of current ratings for Ecopetrol and TotalFinaElf,, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ecopetrol currently has a consensus target price of $10.33, suggesting a potential upside of 9.35%. TotalFinaElf, has a consensus target price of $54.50, suggesting a potential upside of 1.19%. Given Ecopetrol’s higher possible upside, research analysts plainly believe Ecopetrol is more favorable than TotalFinaElf,.
Ecopetrol pays an annual dividend of $0.16 per share and has a dividend yield of 1.7%. TotalFinaElf, pays an annual dividend of $2.34 per share and has a dividend yield of 4.3%. Ecopetrol pays out 36.4% of its earnings in the form of a dividend. TotalFinaElf, pays out 80.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This table compares Ecopetrol and TotalFinaElf,’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility and Risk
Ecopetrol has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500. Comparatively, TotalFinaElf, has a beta of 0.74, suggesting that its stock price is 26% less volatile than the S&P 500.
TotalFinaElf, beats Ecopetrol on 11 of the 16 factors compared between the two stocks.
Ecopetrol Company Profile
Ecopetrol S.A. is an oil company. The Company operates in Colombia, Peru, Brazil and the United States Gulf Coast. The Company’s segments include Exploration and Production, Transportation and Logistics, and Refining, Petrochemicals and Biofuels. The Company’s Exploration and Production segment includes exploration, development and production activities in Colombia and abroad. The Company’s Transportation and Logistics segment includes the transportation of crude oil, motor fuels, fuel oil and other refined products, including diesel and biofuels. The Company’s main crude oil pipeline systems’ operating capacity is approximately 1.34 million barrels per day (BPD). The Company’s main refineries are the Barrancabermeja refinery, which it directly owns and operates, and a refinery in the Free Trade Zone in Cartagena that is operated by Reficar S.A., a subsidiary of the Company. The Company also owns and operates two other minor refineries: Orito and Apiay.
TotalFinaElf, Company Profile
Total S.A. (Total) is an oil and gas company. The Company has three segments: an Upstream segment, including the activities of the exploration and production of hydrocarbons, and the activities of gas and power; a Refining & Chemicals segment constituting an industrial hub consisting of the activities of refining, petrochemicals and specialty chemicals, and also includes the activities of oil trading and shipping, and a Marketing & Services segment, including the activities of supply and marketing in the field of petroleum products, as well as the activity of New Energies. Its Corporate segment includes holdings operating and financial activities. The Company operates in the renewable energies and power generation sectors. It is engaged in various sectors of oil and gas industry, including upstream (hydrocarbon exploration, development and production) and downstream (refining, petrochemicals, specialty chemicals, trading and shipping of crude oil and petroleum products and marketing).
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