Comparing Noble Energy (NBL) and Apache (APA)

Noble Energy (NYSE: NBL) and Apache (NYSE:APA) are both large-cap energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.

Institutional and Insider Ownership

94.4% of Noble Energy shares are owned by institutional investors. Comparatively, 94.7% of Apache shares are owned by institutional investors. 2.3% of Noble Energy shares are owned by company insiders. Comparatively, 0.5% of Apache shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Noble Energy and Apache’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Noble Energy -45.85% 1.06% 0.49%
Apache 10.60% -0.70% -0.25%

Volatility & Risk

Noble Energy has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500. Comparatively, Apache has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500.

Earnings & Valuation

This table compares Noble Energy and Apache’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Noble Energy $3.49 billion 4.48 -$998.00 million ($3.99) -8.05
Apache $5.35 billion 3.32 -$1.41 billion $1.73 26.97

Noble Energy has higher earnings, but lower revenue than Apache. Noble Energy is trading at a lower price-to-earnings ratio than Apache, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Noble Energy and Apache, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Noble Energy 0 2 19 0 2.90
Apache 7 9 2 0 1.72

Noble Energy currently has a consensus price target of $39.68, indicating a potential upside of 23.51%. Apache has a consensus price target of $45.50, indicating a potential downside of 2.47%. Given Noble Energy’s stronger consensus rating and higher probable upside, research analysts clearly believe Noble Energy is more favorable than Apache.

Dividends

Noble Energy pays an annual dividend of $0.40 per share and has a dividend yield of 1.2%. Apache pays an annual dividend of $1.00 per share and has a dividend yield of 2.1%. Noble Energy pays out -10.0% of its earnings in the form of a dividend. Apache pays out 57.8% 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.

Summary

Noble Energy beats Apache on 10 of the 16 factors compared between the two stocks.

About Noble Energy

Noble Energy, Inc. is an independent energy company. The Company is engaged in crude oil, natural gas and natural gas and natural gas liquids (NGLs) exploration, development, production and acquisition. The Company’s segments include: United States, including the onshore DJ Basin, Permian Basin, Eagle Ford Shale, Marcellus Shale and offshore deepwater Gulf of Mexico, as well as the consolidated accounts of Noble Midstream Partners LP (Noble Midstream Partners); Eastern Mediterranean, including offshore Israel and Cyprus; West Africa, including offshore Equatorial Guinea, Cameroon and Gabon, and Other International and Corporate, including new ventures, such as offshore the Falkland Islands, Suriname and Newfoundland. The Company’s portfolio of assets is diversified through the United States and international projects and production mix among crude oil, natural gas and NGLs. Its business focuses on both the United States unconventional basins and certain global conventional basins.

About Apache

Apache Corporation is an independent energy company. The Company explores for, develops, and produces natural gas, crude oil and natural gas liquids. The Company’s production segments include: the United States, Egypt and the United Kingdom North Sea. It also pursues exploration interests in Suriname. In North America, the Company has three onshore regions: The Permian region, The Midcontinent/Gulf Coast region. The Permian region located in West Texas and New Mexico includes the Permian sub-basins, the Midland Basin, Central Basin Platform/Northwest Shelf and Delaware Basin. The Midcontinent/Gulf Coast region includes the Granite Wash, Tonkawa, Canyon Lime, Marmaton, and Cleveland formations of the West Anadarko Basin, the Woodford-SCOOP and Stack plays located in Central Oklahoma, and the Eagle Ford shale in South East Texas.

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