LRR Energy (NYSE: LRE) and EP Energy Corporation (NYSE:EPE) are both small-cap energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, dividends, profitability, analyst recommendations, valuation, earnings and risk.

Institutional and Insider Ownership

70.4% of EP Energy Corporation shares are owned by institutional investors. 1.3% of EP Energy Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations for LRR Energy and EP Energy Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LRR Energy 0 0 0 0 N/A
EP Energy Corporation 6 5 0 0 1.45

EP Energy Corporation has a consensus target price of $3.67, indicating a potential upside of 33.82%. Given EP Energy Corporation’s higher probable upside, analysts plainly believe EP Energy Corporation is more favorable than LRR Energy.

Profitability

This table compares LRR Energy and EP Energy Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LRR Energy -208.41% -34.35% -17.42%
EP Energy Corporation N/A 1.30% 0.16%

Valuation & Earnings

This table compares LRR Energy and EP Energy Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
LRR Energy N/A N/A N/A N/A N/A
EP Energy Corporation $961.00 million 0.73 $611.00 million ($0.95) -2.88

EP Energy Corporation has higher revenue and earnings than LRR Energy.

Summary

EP Energy Corporation beats LRR Energy on 8 of the 8 factors compared between the two stocks.

LRR Energy Company Profile

LRR Energy, L.P. (LRR Energy) operates, acquires, exploits and develops producing oil and natural gas properties in North America. The Company’s properties consist of onshore oil and natural gas properties. Its oil and natural gas properties include the Permian Basin region in West Texas and Southeast New Mexico, the Mid-Continent region in Oklahoma and East Texas, and the Gulf Coast region in Texas. As of December 31, 2014, the Company’s total estimated proved reserves were approximately 33.8 million barrels of oil equivalent (MMBoe), of which approximately 88% were proved developed reserves (approximately 73% proved developed producing and approximately 15% proved developed non-producing). The Company’s general partner is LRE GP, LLC.

EP Energy Corporation Company Profile

EP Energy Corporation (EP Energy) is an independent exploration and production company. The Company is engaged in the acquisition and development of unconventional onshore oil and natural gas properties in the United States. The Company operates through a base of producing assets. It is involved in the development of its drilling inventory located in three areas: the Eagle Ford Shale (South Texas), the Wolfcamp Shale (Permian Basin in West Texas) and the Altamont Field in the Uinta Basin (Northeastern Utah). As of December 31, 2016, in its operating areas, the Company had identified 5,156 drilling locations (including 639 drilling locations to which it has attributed proved undeveloped reserves). As of December 31, 2016, the Company had proved reserves of 432.4 million barrels of oil equivalent (MMBoe) and an average net daily production of 87,641 barrel of oil equivalent per day (Boe/d).

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