Head-To-Head Survey: Approach Resources (OTCMKTS:AREXQ) and Par Pacific (NYSE:PARR)

Par Pacific (NYSE:PARR) and Approach Resources (OTCMKTS:AREXQ) are both small-cap oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, earnings, analyst recommendations, valuation, dividends and institutional ownership.

Volatility and Risk

Par Pacific has a beta of 2.51, meaning that its share price is 151% more volatile than the S&P 500. Comparatively, Approach Resources has a beta of 1.82, meaning that its share price is 82% more volatile than the S&P 500.

Insider and Institutional Ownership

92.9% of Par Pacific shares are owned by institutional investors. Comparatively, 0.1% of Approach Resources shares are owned by institutional investors. 4.8% of Par Pacific shares are owned by company insiders. Comparatively, 2.1% of Approach Resources shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Par Pacific and Approach Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Par Pacific 0 6 1 0 2.14
Approach Resources 0 0 0 0 N/A

Par Pacific currently has a consensus target price of $16.21, suggesting a potential downside of 7.98%. Given Par Pacific’s higher possible upside, research analysts clearly believe Par Pacific is more favorable than Approach Resources.

Earnings & Valuation

This table compares Par Pacific and Approach Resources’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Par Pacific $5.40 billion 0.18 $40.81 million $1.79 9.84
Approach Resources $114.04 million 0.01 -$19.91 million N/A N/A

Par Pacific has higher revenue and earnings than Approach Resources.

Profitability

This table compares Par Pacific and Approach Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Par Pacific -6.35% -26.28% -5.21%
Approach Resources N/A N/A N/A

Summary

Par Pacific beats Approach Resources on 8 of the 11 factors compared between the two stocks.

Par Pacific Company Profile

Par Pacific Holdings, Inc. owns, manages, and maintains interests in energy and infrastructure businesses. The company operates in three segments: Refining, Retail, and Logistics. The Refining segment operates four refineries that produces ultra-low sulfur diesel, gasoline, jet fuel, marine fuel, distillate, asphalt, low sulfur fuel oil, and other associated refined products primarily for consumption in Hawaii, Pacific Northwest, Wyoming, and South Dakota. The Retail segment operates retail outlets, which sell gasoline, diesel, and retail merchandise in the island of Oahu, Maui, Hawaii, and Kauai. It operates 124 outlets under the Hele, 76, nomnom, Cenex, and Zip Trip brand names in Hawaii, Washington, and Idaho. The Logistics segment owns and operates terminals, pipelines, a single-point mooring, and trucking operations to distribute refined products throughout the island of Oahu, Maui, Hawaii, Molokai, and Kauai. It also owns and operates a crude oil pipeline gathering system, a refined products pipeline, and storage facilities and loading racks in Wyoming; and a jet fuel storage facility and pipeline that serves Ellsworth Air Force Base in South Dakota. In addition, this segment owns and operates a marine terminal, a unit train-capable rail loading terminal, storage facilities, a truck rack, and a proprietary pipeline that serves McChord Air Force Base in Washington. The company was formerly known as Par Petroleum Corporation and changed its name to Par Pacific Holdings, Inc. in October 2015. Par Pacific Holdings, Inc. was founded in 1984 and is headquartered in Houston, Texas.

Approach Resources Company Profile

Approach Resources, Inc., an independent energy company, focuses on the acquisition, exploration, development, and production of unconventional oil and gas reserves. The company's properties are primarily located in the Permian Basin in west Texas. It also owns interests in east Texas Basin. As of December 31, 2018, its estimated proved reserves were 180.1 million barrels of oil equivalent located in Crockett and Schleicher counties, Texas. The company also owned and operated 813 producing oil and gas wells in the Permian Basin. Approach Resources, Inc. was incorporated in 2002 and is headquartered in Fort Worth, Texas.

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