Exxon Mobil (XOM) vs. BP Prudhoe Bay Royalty Trust (BPT) Critical Analysis

Exxon Mobil (NYSE:XOM) and BP Prudhoe Bay Royalty Trust (NYSE:BPT) are both oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, valuation, profitability, dividends and earnings.

Risk and Volatility

Exxon Mobil has a beta of 0.86, meaning that its share price is 14% less volatile than the S&P 500. Comparatively, BP Prudhoe Bay Royalty Trust has a beta of -0.48, meaning that its share price is 148% less volatile than the S&P 500.

Institutional & Insider Ownership

52.4% of Exxon Mobil shares are held by institutional investors. Comparatively, 6.2% of BP Prudhoe Bay Royalty Trust shares are held by institutional investors. 0.1% of Exxon Mobil shares are held 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.

Dividends

Exxon Mobil pays an annual dividend of $3.28 per share and has a dividend yield of 4.1%. BP Prudhoe Bay Royalty Trust pays an annual dividend of $5.52 per share and has a dividend yield of 19.1%. Exxon Mobil pays out 91.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Exxon Mobil has increased its dividend for 35 consecutive years.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Exxon Mobil and BP Prudhoe Bay Royalty Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Exxon Mobil 4 12 5 1 2.14
BP Prudhoe Bay Royalty Trust 0 0 0 0 N/A

Exxon Mobil presently has a consensus price target of $87.55, indicating a potential upside of 8.26%. Given Exxon Mobil’s higher possible upside, research analysts clearly believe Exxon Mobil is more favorable than BP Prudhoe Bay Royalty Trust.

Profitability

This table compares Exxon Mobil and BP Prudhoe Bay Royalty Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Exxon Mobil 8.15% 9.56% 5.32%
BP Prudhoe Bay Royalty Trust 98.63% 12,398.12% 8,650.58%

Earnings and Valuation

This table compares Exxon Mobil and BP Prudhoe Bay Royalty Trust’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Exxon Mobil $244.36 billion 1.40 $19.71 billion $3.59 22.53
BP Prudhoe Bay Royalty Trust $78.19 million 7.91 $77.03 million N/A N/A

Exxon Mobil has higher revenue and earnings than BP Prudhoe Bay Royalty Trust.

Summary

Exxon Mobil beats BP Prudhoe Bay Royalty Trust on 10 of the 16 factors compared between the two stocks.

About Exxon Mobil

Exxon Mobil Corporation explores for and produces crude oil and natural gas in the United States, Canada/Other Americas, Europe, Africa, Asia, and Australia/Oceania. It operates through Upstream, Downstream, and Chemical segments. The company also manufactures petroleum products; manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene, and polypropylene plastics, as well as various specialty products; and transports and sells crude oil, natural gas, and petroleum products. As of December 31, 2017, it had approximately 25,827 net operated wells with proved reserves of 21.2 billion oil-equivalent barrels. The company has collaboration agreements with MagnaBond, LLC to develop technologies that enhances evaluation of well cementing, casing, and tubing. Exxon Mobil Corporation was founded in 1870 and is headquartered in Irving, Texas.

About BP Prudhoe Bay Royalty Trust

BP Prudhoe Bay Royalty Trust operates as a grantor trust in the United States. The company holds overriding royalty interest comprising a non-operational interest in minerals in the Prudhoe Bay oil field located on the North Slope of Alaska. The Prudhoe Bay field extends approximately 12 miles by 27 miles and contains approximately 150,000 gross productive acres. As of December 31, 2017, its estimated proved reserves were 9.070 million barrels of oil and condensate of which 9.047 million barrels are proved developed reserves; and 0.023 million barrels are proved undeveloped reserves. BP Prudhoe Bay Royalty Trust was founded in 1989 and is based in Houston, Texas.

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