Head to Head Review: Mach Natural Resources (NYSE:MNR) versus SM Energy (NYSE:SM)

SM Energy (NYSE:SM) and Mach Natural Resources (NYSE:MNR) are both mid-cap energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Profitability

This table compares SM Energy and Mach Natural Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SM Energy	3.45%	13.93%	6.29%
Mach Natural Resources	7.46%	18.46%	9.76%

Risk and Volatility

SM Energy has a beta of 0.73, indicating that its stock price is 27% less volatile than the S&P 500. Comparatively, Mach Natural Resources has a beta of -0.27, indicating that its stock price is 127% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for SM Energy and Mach Natural Resources, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SM Energy	0	6	9	0	2.60
Mach Natural Resources	0	4	2	2	2.75

SM Energy currently has a consensus price target of $37.00, suggesting a potential upside of 33.29%. Mach Natural Resources has a consensus price target of $17.50, suggesting a potential upside of 36.37%. Given Mach Natural Resources’ stronger consensus rating and higher probable upside, analysts clearly believe Mach Natural Resources is more favorable than SM Energy.

Institutional & Insider Ownership

94.6% of SM Energy shares are held by institutional investors. Comparatively, 78.4% of Mach Natural Resources shares are held by institutional investors. 0.5% of SM Energy shares are held by insiders. Comparatively, 87.8% of Mach Natural Resources shares are held 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.

Dividends

SM Energy pays an annual dividend of $0.88 per share and has a dividend yield of 3.2%. Mach Natural Resources pays an annual dividend of $2.56 per share and has a dividend yield of 19.9%. SM Energy pays out 37.0% of its earnings in the form of a dividend. Mach Natural Resources pays out 332.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SM Energy has raised its dividend for 4 consecutive years and Mach Natural Resources has raised its dividend for 1 consecutive years.

Earnings and Valuation

This table compares SM Energy and Mach Natural Resources”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SM Energy	$3.15 billion	2.11	$648.00 million	$2.38	11.66
Mach Natural Resources	$1.18 billion	1.84	$142.98 million	$0.77	16.67

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

About SM Energy

SM Energy Company, an independent energy company, engages in the acquisition, exploration, development, and production of oil, gas, and natural gas liquids in the state of Texas. It has working interests in oil and gas producing wells in the Midland Basin and South Texas. The company was formerly known as St. Mary Land & Exploration Company and changed its name to SM Energy Company in May 2010. SM Energy Company was founded in 1908 and is headquartered in Denver, Colorado.

About Mach Natural Resources

Mach Natural Resources LP, an independent upstream oil and gas company, focuses on the acquisition, development, and production of oil, natural gas, and natural gas liquids reserves in the Anadarko Basin region of Western Oklahoma, Southern Kansas, and the panhandle of Texas. It also owns a portfolio of midstream assets, as well as owns plants and water infrastructure. The company was incorporated in 2023 and is headquartered in Oklahoma City, Oklahoma.