Head-To-Head Survey: LRR Energy (LRE) and ConocoPhillips (COP)

LRR Energy (NYSE: LRE) and ConocoPhillips (NYSE:COP) are both energy companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, earnings, institutional ownership and profitability.

Analyst Recommendations

This is a breakdown of current recommendations for LRR Energy and ConocoPhillips, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LRR Energy 0 0 0 0 N/A
ConocoPhillips 0 6 13 0 2.68

ConocoPhillips has a consensus price target of $58.47, indicating a potential upside of 9.82%. Given ConocoPhillips’ higher probable upside, analysts clearly believe ConocoPhillips is more favorable than LRR Energy.

Dividends

ConocoPhillips pays an annual dividend of $1.06 per share and has a dividend yield of 2.0%. LRR Energy does not pay a dividend. ConocoPhillips pays out -212.0% of its earnings in the form of a dividend.

Institutional and Insider Ownership

69.7% of ConocoPhillips shares are owned by institutional investors. 0.8% of ConocoPhillips shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares LRR Energy and ConocoPhillips’ 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%
ConocoPhillips -2.04% 2.78% 1.12%

Valuation & Earnings

This table compares LRR Energy and ConocoPhillips’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LRR Energy N/A N/A N/A $0.73 5.92
ConocoPhillips $32.58 billion 1.92 -$855.00 million ($0.50) -106.48

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

Summary

ConocoPhillips beats LRR Energy on 11 of the 12 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.

ConocoPhillips Company Profile

ConocoPhillips is an independent exploration and production company. The Company explores for, produces, transports and markets crude oil, bitumen, natural gas, liquefied natural gas (LNG) and natural gas liquids. The Company operates through five segments: Alaska, Lower 48, Canada, Europe and North Africa, Asia Pacific and Middle East, and Other International. The Alaska segment explores for, produces, transports and markets crude oil, natural gas liquids, natural gas and LNG. The Lower 48 segment consists of operations located in the United States Lower 48 states and the Gulf of Mexico. Its Canadian operations consists of oil sands developments in the Athabasca Region of northeastern Alberta. The Europe and North Africa segment consists of operations and exploration activities in Norway, the United Kingdom and Libya. The Asia Pacific and Middle East segment has exploration and production operations in China, Indonesia, Malaysia and Australia.

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