Ecopetrol (NYSE: EC) and QEP Resources (NYSE:QEP) are both mid-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.
Ecopetrol pays an annual dividend of $0.16 per share and has a dividend yield of 1.4%. QEP Resources does not pay a dividend. Ecopetrol pays out 36.4% of its earnings in the form of a dividend.
This table compares Ecopetrol and QEP Resources’ 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 1.14, suggesting that its stock price is 14% more volatile than the S&P 500. Comparatively, QEP Resources has a beta of 1.73, suggesting that its stock price is 73% more volatile than the S&P 500.
This is a breakdown of recent ratings and price targets for Ecopetrol and QEP Resources, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ecopetrol presently has a consensus target price of $9.67, indicating a potential downside of 17.94%. QEP Resources has a consensus target price of $14.43, indicating a potential upside of 39.54%. Given QEP Resources’ stronger consensus rating and higher probable upside, analysts clearly believe QEP Resources is more favorable than Ecopetrol.
Insider & Institutional Ownership
2.1% of Ecopetrol shares are owned by institutional investors. Comparatively, 93.3% of QEP Resources shares are owned by institutional investors. 1.4% of QEP Resources shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares Ecopetrol and QEP Resources’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Ecopetrol||$15.75 billion||1.54||$3.18 billion||$0.44||26.77|
|QEP Resources||$1.38 billion||1.81||-$1.25 billion||($0.06)||-172.30|
Ecopetrol has higher revenue and earnings than QEP Resources. QEP Resources is trading at a lower price-to-earnings ratio than Ecopetrol, indicating that it is currently the more affordable of the two stocks.
QEP Resources beats Ecopetrol on 9 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.
QEP Resources Company Profile
QEP Resources, Inc. is an independent crude oil and natural gas exploration and production company. The Company focuses on two regions of the United States: the Northern Region (primarily in North Dakota, Wyoming and Utah) and the Southern Region (primarily in Texas and Louisiana). The Company conducts exploration and production activities in North America’s hydrocarbon resource plays. The Company has an inventory of developed and undeveloped drilling locations in the Permian Basin in western Texas, the Williston Basin in North Dakota, Haynesville/Cotton Valley in northwestern Louisiana, the Uinta Basin in eastern Utah and other properties in Wyoming, Utah and Colorado. It sells gas volumes to wholesale marketers, industrial users, local distribution companies and utilities. It sells oil and natural gas liquid (NGL) volumes to refiners, marketers and other companies.
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