Head to Head Comparison: Expand Energy (NASDAQ:EXE) and Meren Energy (OTCMKTS:AOIFF)

Expand Energy (NASDAQ:EXE) and Meren Energy (OTCMKTS:AOIFF) are both energy companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.

Insider and Institutional Ownership

97.9% of Expand Energy shares are held by institutional investors. 0.2% of Expand Energy shares are held by insiders. Comparatively, 1.0% of Meren Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Expand Energy pays an annual dividend of $2.30 per share and has a dividend yield of 2.1%. Meren Energy pays an annual dividend of $0.14 per share and has a dividend yield of 9.4%. Expand Energy pays out 65.3% of its earnings in the form of a dividend. Meren Energy pays out -26.9% 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. Meren Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Expand Energy has a beta of 0.46, meaning that its stock price is 54% less volatile than the S&P 500. Comparatively, Meren Energy has a beta of 0.53, meaning that its stock price is 47% less volatile than the S&P 500.

Profitability

This table compares Expand Energy and Meren Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Expand Energy	7.99%	6.31%	4.02%
Meren Energy	N/A	3.52%	1.68%

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Expand Energy	$4.24 billion	6.17	-$714.00 million	$3.52	31.15
Meren Energy	N/A	N/A	-$279.10 million	($0.52)	-2.87

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

Analyst Ratings

This is a breakdown of current recommendations and price targets for Expand Energy and Meren Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Expand Energy	0	3	17	1	2.90
Meren Energy	0	0	0	0	0.00

Expand Energy presently has a consensus target price of $130.29, suggesting a potential upside of 18.81%. Given Expand Energy’s stronger consensus rating and higher probable upside, analysts clearly believe Expand Energy is more favorable than Meren Energy.

Summary

Expand Energy beats Meren Energy on 11 of the 16 factors compared between the two stocks.

About Expand Energy

Expand Energy Corporation is an independent natural gas producer principally in the United States. Expand Energy Corporation, formerly known as Chesapeake Energy Corporation, is based in OKLAHOMA CITY.

About Meren Energy

Africa Oil Corp., together with its subsidiaries, operates as an oil and gas exploration and production company in Kenya, Nigeria, and South Africa. The company holds interests in producing and development assets in deep-water Nigeria, and development assets in Kenya. It also has a portfolio of exploration and appraisal assets in Namibia, Nigeria, South Africa, and Kenya, as well as Guyana and Senegal Guinea Bissau Joint Development Zone. The company was formerly known as Canmex Minerals Corporation and changed its name to Africa Oil Corp. in August 2007. Africa Oil Corp. was incorporated in 1983 and is headquartered in Vancouver, Canada.