Head-To-Head Analysis: U.S. Energy (NASDAQ:USEG) and Birchcliff Energy (OTCMKTS:BIREF)

U.S. Energy (NASDAQ:USEG) and Birchcliff Energy (OTCMKTS:BIREF) are both small-cap energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, risk, institutional ownership, earnings, profitability, valuation and analyst recommendations.

Risk & Volatility

U.S. Energy has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500. Comparatively, Birchcliff Energy has a beta of 0.51, meaning that its stock price is 49% less volatile than the S&P 500.

Dividends

U.S. Energy pays an annual dividend of $0.09 per share and has a dividend yield of 7.8%. Birchcliff Energy pays an annual dividend of $0.08 per share and has a dividend yield of 1.9%. U.S. Energy pays out -9.2% of its earnings in the form of a dividend. Birchcliff Energy pays out 57.1% 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. U.S. Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares U.S. Energy and Birchcliff Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
U.S. Energy	$20.62 million	2.01	-$32.36 million	($0.98)	-1.18
Birchcliff Energy	$428.33 million	2.64	$40.95 million	$0.14	29.64

Birchcliff Energy has higher revenue and earnings than U.S. Energy. U.S. Energy is trading at a lower price-to-earnings ratio than Birchcliff Energy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares U.S. Energy and Birchcliff Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
U.S. Energy	-141.51%	-71.83%	-39.03%
Birchcliff Energy	9.39%	2.49%	1.68%

Analyst Ratings

This is a breakdown of current ratings and price targets for U.S. Energy and Birchcliff Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
U.S. Energy	0	0	1	0	3.00
Birchcliff Energy	0	0	0	6	4.00

U.S. Energy presently has a consensus price target of $3.50, suggesting a potential upside of 201.72%. Given U.S. Energy’s higher possible upside, analysts clearly believe U.S. Energy is more favorable than Birchcliff Energy.

Institutional & Insider Ownership

3.0% of U.S. Energy shares are owned by institutional investors. Comparatively, 0.8% of Birchcliff Energy shares are owned by institutional investors. 70.9% of U.S. Energy shares are owned by insiders. Comparatively, 1.5% of Birchcliff Energy shares are owned by 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.

Summary

Birchcliff Energy beats U.S. Energy on 10 of the 17 factors compared between the two stocks.

About U.S. Energy

U.S. Energy Corp., an independent energy company, focuses on the acquisition, exploration, and development of oil and natural gas properties in the United States. It holds interests in various oil and gas properties located in the Rockies region, including Montana, Wyoming, and North Dakota; the Mid-Continent region comprising Oklahoma, Kansas, and North and East Texas; West Texas; South Texas; and the Gulf Coast regions. The company was incorporated in 1966 and is headquartered in Houston, Texas.

About Birchcliff Energy

Birchcliff Energy Ltd., an intermediate oil and natural gas company, explores for, develops, and produces natural gas, light oil, condensate, and other natural gas liquids in Western Canada. The company holds interests in the areas of Montney/Doig Resource Play, including the Pouce Coupe and Gordondale properties in Alberta. Birchcliff Energy Ltd. was founded in 2004 and is headquartered in Calgary, Canada.