Financial Contrast: Earthstone Energy (ESTE) & Petroquest Energy (PQUEQ)

Earthstone Energy (NYSE:ESTE) and Petroquest Energy (OTCMKTS:PQUEQ) are both small-cap oils/energy companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, risk, earnings, analyst recommendations and valuation.

Valuation & Earnings

This table compares Earthstone Energy and Petroquest Energy’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Earthstone Energy $165.36 million 2.57 $42.33 million $1.43 4.64
Petroquest Energy $108.29 million 0.00 -$6.63 million ($0.55) -0.04

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

Profitability

This table compares Earthstone Energy and Petroquest Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Earthstone Energy 25.60% 11.92% 10.06%
Petroquest Energy -4.93% N/A -3.76%

Institutional and Insider Ownership

20.0% of Earthstone Energy shares are owned by institutional investors. Comparatively, 0.1% of Petroquest Energy shares are owned by institutional investors. 64.4% of Earthstone Energy shares are owned by insiders. Comparatively, 8.8% of Petroquest Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Volatility and Risk

Earthstone Energy has a beta of 1.89, meaning that its share price is 89% more volatile than the S&P 500. Comparatively, Petroquest Energy has a beta of 4.22, meaning that its share price is 322% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Earthstone Energy and Petroquest Energy, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Earthstone Energy 0 0 7 0 3.00
Petroquest Energy 0 0 0 0 N/A

Earthstone Energy currently has a consensus price target of $11.40, indicating a potential upside of 71.95%. Given Earthstone Energy’s higher probable upside, analysts clearly believe Earthstone Energy is more favorable than Petroquest Energy.

Summary

Earthstone Energy beats Petroquest Energy on 12 of the 13 factors compared between the two stocks.

Earthstone Energy Company Profile

Earthstone Energy, Inc., an oil and natural gas development and production company, operates in the up-stream segment of the oil and natural gas industry in the United States. Its asset portfolio includes the Midland Basin of west Texas and the Eagle Ford trend of south Texas. As of December 31, 2017, the company operated 91 gross Eagle Ford wells; and 12 gross Austin Chalk wells, as well as had 79,976 thousand barrels of oil equivalent (MBOE) of total proved reserves, 19,961 MBOE of proved developed reserves, and 60,015 MBOE of proved undeveloped reserves. Earthstone Energy, Inc. was founded in 1969 and is headquartered in The Woodlands, Texas.

Petroquest Energy Company Profile

PetroQuest Energy, Inc. operates as an independent oil and gas company in Texas and Louisiana. The company acquires, explores for, develops, and operates oil and gas properties. As of December 31, 2017, it had estimated proved reserves of 1.8 million barrels of oil; 19.4 billion cubic feet equivalent of natural gas liquids; and 125.4 billion cubic feet of natural gas. PetroQuest Energy, Inc. was founded in 1983 and is headquartered in Lafayette, Louisiana. On November 6, 2018, PetroQuest Energy, Inc. along with its affiliates filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.

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