ENI S.p.A. (E) versus Statoil ASA (STO) Critical Survey

Statoil ASA (NYSE: STO) and ENI S.p.A. (NYSE:E) are both large-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 and Earnings

This table compares Statoil ASA and ENI S.p.A.’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Statoil ASA $55.12 billion 1.15 $18.51 billion ($0.24) -81.79
ENI S.p.A. $75.00 billion 0.79 $13.24 billion $0.41 79.37

Statoil ASA has higher revenue, but lower earnings than ENI S.p.A.. Statoil ASA is trading at a lower price-to-earnings ratio than ENI S.p.A., indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Statoil ASA and ENI S.p.A.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Statoil ASA -1.32% 5.61% 1.93%
ENI S.p.A. 1.14% 2.23% 0.94%

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Statoil ASA and ENI S.p.A., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Statoil ASA 3 7 3 0 2.00
ENI S.p.A. 5 3 4 0 1.92

Statoil ASA presently has a consensus target price of $17.67, suggesting a potential downside of 10.00%. ENI S.p.A. has a consensus target price of $16.00, suggesting a potential downside of 50.83%. Given Statoil ASA’s stronger consensus rating and higher possible upside, equities analysts clearly believe Statoil ASA is more favorable than ENI S.p.A..

Volatility and Risk

Statoil ASA has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500. Comparatively, ENI S.p.A. has a beta of 0.75, indicating that its share price is 25% less volatile than the S&P 500.

Insider and Institutional Ownership

5.0% of Statoil ASA shares are held by institutional investors. Comparatively, 1.7% of ENI S.p.A. shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Statoil ASA pays an annual dividend of $0.70 per share and has a dividend yield of 3.6%. ENI S.p.A. pays an annual dividend of $1.27 per share and has a dividend yield of 3.9%. Statoil ASA pays out -291.7% of its earnings in the form of a dividend. ENI S.p.A. pays out 309.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. ENI S.p.A. has increased its dividend for 4 consecutive years. ENI S.p.A. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Statoil ASA beats ENI S.p.A. on 9 of the 15 factors compared between the two stocks.

Statoil ASA Company Profile

Statoil ASA (Statoil) is an energy company. The Company is engaged in oil and gas exploration and production activities. The Company’s segments include Development and Production Norway (DPN), Development and Production International (DPI), Marketing, Midstream and Processing (MMP) and Other. DPN segment manages the Company’s upstream activities on the Norwegian continental shelf (NCS) and explores for and extracts crude oil, natural gas and natural gas liquids. DPI segment manages the Company’s upstream activities that are not included in the DPN and Development and Production USA (DPUSA) business areas. MMP segment manages its marketing and trading activities related to oil products and natural gas, transportation, processing and manufacturing, and the development of oil and gas. Other segment includes activities in New Energy Solutions (NES), Technology, Projects and Drilling (TPD), Global Strategy and Business Development (GSB), and Corporate staffs and support functions.

ENI S.p.A. Company Profile

Eni SpA (Eni) is an Italy-based company engaged in the exploration, development and production of hydrocarbons, in the supply and marketing of gas, liquefied natural gas (LNG) and power, in the refining and marketing of petroleum products, in the production and marketing of basic petrochemicals, plastics and elastomers and in commodity trading. The Company’s segments include Exploration & Production, Gas & Power, and Refining & Marketing. Its Exploration & Production segment engages in oil and natural gas exploration and field development and production, as well as LNG operations in over 40 countries, including Italy, Libya, Egypt, Norway, the United Kingdom, Angola, Congo, Nigeria, the United States, Kazakhstan, Algeria, Australia, Venezuela, Iraq, Ghana and Mozambique. Its Gas & Power segment engages in supply, trading and marketing of gas, LNG and electricity, international gas transport activities and commodity trading and derivatives.

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