Financial Review: Energen (EGN) & Newfield Exploration (NFX)

Energen (NYSE: EGN) and Newfield Exploration (NYSE:NFX) are both mid-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, dividends, earnings, profitability, valuation, institutional ownership and risk.

Valuation and Earnings

This table compares Energen and Newfield Exploration’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Energen $961.04 million 7.61 $306.82 million $0.75 100.13
Newfield Exploration $1.77 billion 3.42 $427.00 million $2.15 14.06

Newfield Exploration has higher revenue and earnings than Energen. Newfield Exploration is trading at a lower price-to-earnings ratio than Energen, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Energen and Newfield Exploration’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Energen 34.60% 4.95% 3.33%
Newfield Exploration 18.96% 36.67% 10.24%

Risk and Volatility

Energen has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500. Comparatively, Newfield Exploration has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for Energen and Newfield Exploration, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Energen 1 6 14 0 2.62
Newfield Exploration 0 9 14 0 2.61

Energen presently has a consensus target price of $71.95, suggesting a potential downside of 4.20%. Newfield Exploration has a consensus target price of $37.65, suggesting a potential upside of 24.59%. Given Newfield Exploration’s higher possible upside, analysts plainly believe Newfield Exploration is more favorable than Energen.

Insider & Institutional Ownership

93.3% of Energen shares are owned by institutional investors. Comparatively, 99.3% of Newfield Exploration shares are owned by institutional investors. 1.0% of Energen shares are owned by insiders. Comparatively, 0.6% of Newfield Exploration shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Newfield Exploration beats Energen on 8 of the 13 factors compared between the two stocks.

Energen Company Profile

Energen Corporation, through its subsidiary, Energen Resources Corporation, engages in the exploration, development, and production of oil, natural gas liquids, and natural gas. The company has operations within the Midland Basin, the Delaware Basin, and the Central Basin Platform areas of the Permian Basin in west Texas and New Mexico. As of December 31, 2017, it had a total proved reserves of 444 million barrel of oil equivalent. The company was founded in 1929 and is headquartered in Birmingham, Alabama.

Newfield Exploration Company Profile

Newfield Exploration Company, an independent energy company, engages in the exploration, development, and production of crude oil, natural gas, and natural gas liquids in the United States. The company has operations principally in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota, and the Uinta Basin of Utah. It also holds oil producing assets offshore China. The company was founded in 1988 and is headquartered in The Woodlands, Texas.

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