Viper Energy Partners (VNOM) vs. Kosmos Energy (KOS) Head to Head Survey

Viper Energy Partners (NASDAQ:VNOM) and Kosmos Energy (NYSE:KOS) are both mid-cap oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, institutional ownership and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Viper Energy Partners and Kosmos Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Viper Energy Partners 0 1 10 2 3.08
Kosmos Energy 0 0 10 0 3.00

Viper Energy Partners presently has a consensus price target of $41.75, indicating a potential upside of 53.44%. Kosmos Energy has a consensus price target of $10.09, indicating a potential upside of 96.28%. Given Kosmos Energy’s higher probable upside, analysts clearly believe Kosmos Energy is more favorable than Viper Energy Partners.

Dividends

Viper Energy Partners pays an annual dividend of $2.32 per share and has a dividend yield of 8.5%. Kosmos Energy does not pay a dividend. Viper Energy Partners pays out 216.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Viper Energy Partners and Kosmos Energy’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Viper Energy Partners $172.03 million 19.62 $111.47 million $1.07 25.43
Kosmos Energy $636.84 million 3.50 -$222.79 million ($0.33) -15.58

Viper Energy Partners has higher earnings, but lower revenue than Kosmos Energy. Kosmos Energy is trading at a lower price-to-earnings ratio than Viper Energy Partners, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Viper Energy Partners has a beta of 1.1, suggesting that its share price is 10% more volatile than the S&P 500. Comparatively, Kosmos Energy has a beta of 1.9, suggesting that its share price is 90% more volatile than the S&P 500.

Institutional and Insider Ownership

29.7% of Viper Energy Partners shares are held by institutional investors. Comparatively, 92.9% of Kosmos Energy shares are held by institutional investors. 0.3% of Viper Energy Partners shares are held by insiders. Comparatively, 3.8% of Kosmos Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Viper Energy Partners and Kosmos Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Viper Energy Partners 67.73% 10.95% 8.78%
Kosmos Energy -51.49% -21.93% -5.57%

Summary

Viper Energy Partners beats Kosmos Energy on 10 of the 16 factors compared between the two stocks.

Viper Energy Partners Company Profile

Viper Energy Partners LP owns, acquires, and exploits oil and natural gas properties in North America. The company holds mineral interests covering an area of approximately 43,843 net acres in the Permian Basin, West Texas. As of December 31, 2017, its estimated proved oil and natural gas reserves consisted of 38,246 thousand barrels of crude oil equivalent. Viper Energy Partners GP LLC operates as the general partner of the company. The company was founded in 2013 and is based in Midland, Texas. Viper Energy Partners LP is a subsidiary of Diamondback Energy, Inc.

Kosmos Energy Company Profile

Kosmos Energy Ltd. explores for and produces oil and gas in Africa and South America. Its asset portfolio includes production and other development projects in offshore Ghana and Equatorial Guinea; and exploration potential in offshore Mauritania and Senegal, as well as exploration licenses in offshore Cote d'Ivoire, Equatorial Guinea, Morocco, Sao Tome and Principe, and Suriname. The company was founded in 2003 and is based in Hamilton, Bermuda.

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