Critical Review: HyperDynamics (OTCMKTS:HDYNQ) versus Devon Energy (NYSE:DVN)

Devon Energy (NYSE:DVN) and HyperDynamics (OTCMKTS:HDYNQ) are both energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Analyst Ratings

This is a summary of recent ratings and price targets for Devon Energy and HyperDynamics, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Devon Energy	1	6	21	2	2.80
HyperDynamics	0	0	0	0	0.00

Devon Energy presently has a consensus target price of $44.62, suggesting a potential upside of 29.50%. Given Devon Energy’s stronger consensus rating and higher probable upside, research analysts clearly believe Devon Energy is more favorable than HyperDynamics.

Valuation & Earnings

This table compares Devon Energy and HyperDynamics”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Devon Energy	$15.94 billion	1.36	$2.89 billion	$4.25	8.11
HyperDynamics	N/A	N/A	N/A	N/A	N/A

Devon Energy has higher revenue and earnings than HyperDynamics.

Volatility and Risk

Devon Energy has a beta of 0.6, indicating that its stock price is 40% less volatile than the S&P 500. Comparatively, HyperDynamics has a beta of 6.14, indicating that its stock price is 514% more volatile than the S&P 500.

Institutional & Insider Ownership

69.7% of Devon Energy shares are held by institutional investors. 0.7% of Devon Energy shares are held by company insiders. Comparatively, 5.9% of HyperDynamics shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Devon Energy and HyperDynamics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Devon Energy	15.56%	18.14%	8.79%
HyperDynamics	N/A	N/A	N/A

Summary

Devon Energy beats HyperDynamics on 9 of the 11 factors compared between the two stocks.

About Devon Energy

Devon Energy Corporation, an independent energy company, engages in the exploration, development, and production of oil, natural gas, and natural gas liquids in the United States. It operates in Delaware, Eagle Ford, Anadarko, Williston, and Powder River Basins. The company was founded in 1971 and is headquartered in Oklahoma City, Oklahoma.

About HyperDynamics

Hyperdynamics Corporation, together with its subsidiaries, operates as an independent oil and gas exploration company. It engages in the acquisition, exploration, and development of oil and natural gas properties in the Republic of Guinea, Northwest Africa. The company owns a 100% interest in a concession that covers an area of approximately 5,000 square miles in offshore Guinea. Hyperdynamics Corporation was founded in 1983 and is headquartered in Houston, Texas.