Head to Head Comparison: Encana (ECA) vs. Jagged Peak Energy (JAG)

Encana (NYSE: ECA) and Jagged Peak Energy (NYSE:JAG) are both oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Encana and Jagged Peak Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Encana 0 1 20 1 3.00
Jagged Peak Energy 0 7 8 0 2.53

Encana currently has a consensus target price of $15.98, suggesting a potential upside of 18.16%. Jagged Peak Energy has a consensus target price of $16.12, suggesting a potential upside of 12.30%. Given Encana’s stronger consensus rating and higher probable upside, analysts plainly believe Encana is more favorable than Jagged Peak Energy.

Profitability

This table compares Encana and Jagged Peak Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Encana 1.49% 7.30% 3.24%
Jagged Peak Energy 0.70% 14.96% 9.45%

Volatility and Risk

Encana has a beta of 2, meaning that its stock price is 100% more volatile than the S&P 500. Comparatively, Jagged Peak Energy has a beta of -1.04, meaning that its stock price is 204% less volatile than the S&P 500.

Institutional & Insider Ownership

67.7% of Encana shares are owned by institutional investors. Comparatively, 27.2% of Jagged Peak Energy shares are owned by institutional investors. 0.1% of Encana shares are owned by insiders. Comparatively, 1.5% of Jagged Peak Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Encana and Jagged Peak Energy’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Encana $4.44 billion 2.91 $827.00 million $0.43 31.44
Jagged Peak Energy $267.31 million 11.44 -$451.93 million $0.26 55.19

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

Dividends

Encana pays an annual dividend of $0.06 per share and has a dividend yield of 0.4%. Jagged Peak Energy does not pay a dividend. Encana pays out 14.0% of its earnings in the form of a dividend.

Summary

Encana beats Jagged Peak Energy on 11 of the 17 factors compared between the two stocks.

Encana Company Profile

Encana Corporation, together with its subsidiaries, engages in the exploration, development, production, and marketing of natural gas, oil, and natural gas liquids. The company holds interests in various assets, including the Montney in northern British Columbia and northwest Alberta; Duvernay in west central Alberta; and other upstream operations comprising Wheatland in southern Alberta, Horn River in northeast British Columbia, and Deep Panuke located in offshore Nova Scotia in Canada. It also owns interests in assets consisting of the Eagle Ford in south Texas and Permian in west Texas; and San Juan in northwest New Mexico. The company primarily markets its products to refiners, local distribution companies, energy marketing companies, and electronic exchanges. Encana Corporation was founded in 1971 and is headquartered in Calgary, Canada.

Jagged Peak Energy Company Profile

Jagged Peak Energy Inc. operates as an independent oil and natural gas company. The company focuses on the acquisition and development of unconventional oil and associated liquids-rich natural gas reserves in the Southern Delaware basin, a sub-basin of the Permian basin of West Texas. As of December 31, 2016, it held an 86% average working interest in approximately 75,200 net acres with an estimated net proved reserves of 82,358 thousand barrel of oil equivalent, as well as owned a 94% average working interest in 94 net productive wells. Jagged Peak Energy Inc. was founded in 2013 and is headquartered in Denver, Colorado.

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