Reviewing Laredo Petroleum (LPI) & Comstock Resources (CRK)

Laredo Petroleum (NYSE:LPI) and Comstock Resources (NYSE:CRK) are both small-cap oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, institutional ownership, dividends, valuation, analyst recommendations, profitability and risk.

Valuation & Earnings

This table compares Laredo Petroleum and Comstock Resources’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Laredo Petroleum $822.16 million 1.85 $548.97 million $0.60 10.80
Comstock Resources $255.33 million 0.54 -$111.40 million ($3.90) -2.17

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

Profitability

This table compares Laredo Petroleum and Comstock Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Laredo Petroleum 51.05% 25.80% 9.27%
Comstock Resources -52.14% N/A -3.97%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Laredo Petroleum and Comstock Resources, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Laredo Petroleum 2 9 4 0 2.13
Comstock Resources 0 3 2 0 2.40

Laredo Petroleum presently has a consensus target price of $12.38, suggesting a potential upside of 91.12%. Comstock Resources has a consensus target price of $10.93, suggesting a potential upside of 29.39%. Given Laredo Petroleum’s higher possible upside, equities analysts clearly believe Laredo Petroleum is more favorable than Comstock Resources.

Volatility & Risk

Laredo Petroleum has a beta of 1.21, suggesting that its share price is 21% more volatile than the S&P 500. Comparatively, Comstock Resources has a beta of -0.16, suggesting that its share price is 116% less volatile than the S&P 500.

Institutional and Insider Ownership

38.3% of Comstock Resources shares are held by institutional investors. 2.2% of Laredo Petroleum shares are held by company insiders. Comparatively, 14.5% of Comstock Resources shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Laredo Petroleum beats Comstock Resources on 11 of the 14 factors compared between the two stocks.

Laredo Petroleum Company Profile

Laredo Petroleum, Inc. operates as an independent energy company in the United States. It operates through two segments, Exploration and Production; and Midstream and Marketing. The company engages in the acquisition, exploration, and development of oil and natural gas properties; and the transportation of oil and natural gas primarily in the Permian Basin in West Texas, as well as rig fuel, natural gas lift, and water delivery and takeaway services. As of December 31, 2017, it had assembled 124,843 net acres in the Permian Basin; and had total proved reserves of 215,883 thousand barrels of oil equivalent. The company was formerly known as Laredo Petroleum Holdings, Inc. and changed its name to Laredo Petroleum, Inc. in December 2013. Laredo Petroleum, Inc. was founded in 2006 and is headquartered in Tulsa, Oklahoma.

Comstock Resources Company Profile

Comstock Resources, Inc., an independent energy company, engages in the acquisition, exploration, and development of oil and gas resources primarily in Texas and Louisiana. The company is headquartered in Frisco, Texas.

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