Unit Corporation (NYSE: UNT) and EXCO Resources NL (NYSE:XCO) are both small-cap oils/energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, analyst recommendations, valuation, dividends, risk and profitability.

Insider and Institutional Ownership

92.6% of Unit Corporation shares are held by institutional investors. Comparatively, 56.7% of EXCO Resources NL shares are held by institutional investors. 3.3% of Unit Corporation shares are held by company insiders. Comparatively, 2.0% of EXCO Resources NL shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Unit Corporation and EXCO Resources NL, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Unit Corporation 0 3 1 0 2.25
EXCO Resources NL 0 0 0 0 N/A

Unit Corporation presently has a consensus target price of $25.25, indicating a potential upside of 37.68%. Given Unit Corporation’s higher possible upside, research analysts plainly believe Unit Corporation is more favorable than EXCO Resources NL.

Profitability

This table compares Unit Corporation and EXCO Resources NL’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Unit Corporation 0.39% 2.07% 1.01%
EXCO Resources NL 47.81% N/A -2.58%

Volatility & Risk

Unit Corporation has a beta of 2.84, suggesting that its stock price is 184% more volatile than the S&P 500. Comparatively, EXCO Resources NL has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500.

Earnings & Valuation

This table compares Unit Corporation and EXCO Resources NL’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Unit Corporation $673.99 million 1.44 $294.64 million $0.03 611.33
EXCO Resources NL $303.66 million 0.08 $104.21 million $7.42 0.17

Unit Corporation has higher revenue and earnings than EXCO Resources NL. EXCO Resources NL is trading at a lower price-to-earnings ratio than Unit Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Unit Corporation beats EXCO Resources NL on 10 of the 12 factors compared between the two stocks.

About Unit Corporation

Unit Corporation is an oil and natural gas contract drilling company. The Company has operations in the exploration and production and mid-stream areas. The Company operates through three segments: Oil and Natural Gas, Contract Drilling and Mid-Stream. It is primarily engaged in the exploration, development, acquisition, and production of oil and natural gas properties, the land contract drilling of natural gas and oil wells, and the buying, selling, gathering, processing and treating of natural gas. Its Oil and Natural Gas operations are carried out by its subsidiary Unit Petroleum Company. Contract Drilling operations are carried out by its subsidiary Unit Drilling Company. Its drills onshore oil and natural gas wells for its own account, as well as for other oil and natural gas companies. Its Mid-Stream operations are carried out by its subsidiary Superior Pipeline Company, L.L.C. Its mid-stream operations consist of buying, selling, gathering, processing and treating natural gas.

About EXCO Resources NL

EXCO Resources, Inc. (EXCO) is an oil and natural gas company. The Company is engaged in the exploration, exploitation, acquisition, development and production of onshore United States oil and natural gas properties with a focus on shale resource plays. The Company’s principal operations are conducted in certain United States oil and natural gas areas, including Texas, Louisiana and the Appalachia region. The Company holds acreage positions in approximately three shale plays in the United States, including East Texas and North Louisiana, South Texas and Appalachia. In East Texas and North Louisiana, the Company holds approximately 83,800 net acres in the Haynesville and Bossier shales. In South Texas, it holds approximately 65,800 net acres in the Eagle Ford shale. In Appalachia, the Company holds approximately 137,400 net acres prospective in the Marcellus shale.

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