Matador Resources (MTDR) versus RWE (RWEOY) Financial Contrast

Matador Resources (NYSE: MTDR) and RWE (OTCMKTS:RWEOY) are both oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Risk and Volatility

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Matador Resources has a beta of 1.21, suggesting that its stock price is 21% more volatile than the S&P 500. Comparatively, RWE has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Valuation & Earnings

This table compares Matador Resources and RWE’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Matador Resources $544.28 million 5.54 $125.86 million $0.72 38.33
RWE $48.24 billion 0.31 -$6.25 billion $1.39 17.68

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

Institutional and Insider Ownership

87.6% of Matador Resources shares are owned by institutional investors. Comparatively, 0.1% of RWE shares are owned by institutional investors. 11.9% of Matador Resources shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Matador Resources and RWE’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Matador Resources 22.64% 7.11% 3.94%
RWE -7.68% 13.94% 1.86%

Analyst Ratings

This is a summary of current ratings and price targets for Matador Resources and RWE, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Matador Resources 0 4 11 0 2.73
RWE 1 4 2 0 2.14

Matador Resources presently has a consensus target price of $33.60, indicating a potential upside of 21.74%. Given Matador Resources’ stronger consensus rating and higher possible upside, analysts plainly believe Matador Resources is more favorable than RWE.

Summary

Matador Resources beats RWE on 11 of the 14 factors compared between the two stocks.

Matador Resources Company Profile

Matador Resources Company is an independent energy company engaged in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays. The Company’s segments include exploration and production, and midstream. The Company’s operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The Company also operates in the Eagle Ford shale play in South Texas and the Haynesville shale and Cotton Valley plays in Northwest Louisiana and East Texas. Additionally, the Company conducts midstream operations primarily, as of February 17, 2017, through its midstream joint venture, San Mateo Midstream, LLC (San Mateo or the Joint Venture).

RWE Company Profile

RWE AG (RWE) is a holding company. The Company is a supplier of electricity and natural gas in Europe. The Company is engaged in production of lignite and electricity generation from gas, coal, nuclear and renewables, to energy trading and distribution, and the supply of electricity, gas and other solutions. The Company’s segments include Conventional Power Generation, Trading /Gas Midstream and innogy SE (innogy). The Company’s Conventional Power Generation segment includes its conventional electricity generation activities in Germany, the United Kingdom, the Netherlands and Turkey. The Company’s Trading /Gas Midstream segment covers the activities of RWE Supply & Trading GmbH, which is responsible for trading energy commodities, marketing and hedging the Company’s electricity position. innogy is responsible for business activities in renewables, grids and retail. The Company has a power generation capacity of over 40,000 Megawatt at approximately 80 locations.

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