Tellurian (NASDAQ: TELL) and Concho Resources (NYSE:CXO) are both energy companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, dividends, valuation, earnings, profitability, risk and institutional ownership.
Risk and Volatility
Tellurian has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500. Comparatively, Concho Resources has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.
This is a summary of recent recommendations for Tellurian and Concho Resources, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Tellurian presently has a consensus target price of $14.50, suggesting a potential upside of 45.15%. Concho Resources has a consensus target price of $167.89, suggesting a potential upside of 14.59%. Given Tellurian’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Tellurian is more favorable than Concho Resources.
Valuation and Earnings
This table compares Tellurian and Concho Resources’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Concho Resources||$1.63 billion||13.33||-$1.46 billion||$3.80||38.56|
Tellurian has higher earnings, but lower revenue than Concho Resources. Tellurian is trading at a lower price-to-earnings ratio than Concho Resources, indicating that it is currently the more affordable of the two stocks.
This table compares Tellurian and Concho Resources’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional & Insider Ownership
10.6% of Tellurian shares are owned by institutional investors. Comparatively, 95.0% of Concho Resources shares are owned by institutional investors. 48.3% of Tellurian shares are owned by insiders. Comparatively, 1.0% of Concho Resources shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Concho Resources beats Tellurian on 8 of the 14 factors compared between the two stocks.
Tellurian Company Profile
Tellurian Inc., formerly Magellan Petroleum Corporation, is an oil and gas exploration and production company. The Company focuses on the development of liquefied natural gas (LNG) projects along the United States Gulf Coast through its subsidiary, Tellurian Investments Inc. The Company owns interests in the Horse Hill-1 well and related licenses in the Weald Basin, onshore the United Kingdom, and an exploration block, NT/P82, in the Bonaparte Basin, offshore Northern Territory, Australia. The Horse Hill-1 well has identified prospects from the Portland sandstone and Kimmeridge Clay limestone formations.
Concho Resources Company Profile
Concho Resources Inc. is an independent oil and natural gas company engaged in the acquisition, development and exploration of oil and natural gas properties. The Company’s four operating areas include the Northern Delaware Basin, the Southern Delaware Basin, the Midland Basin and the New Mexico Shelf. As of December 31, 2016, the Company’s operations were focused in the Permian Basin, which underlies an area of Southeast New Mexico and West Texas approximately 250 miles wide and 300 miles long. The Permian Basin is an oil and natural gas producing region in the United States and is characterized by multiple producing horizons and enhanced recovery potential. As of December 31, 2016, the Company produced approximately 55.1 million barrels of oil equivalent (MMBoe) of oil and natural gas. As of December 31, 2016, all of its 720 MMBoe total estimated proved reserves were located in its core operating areas and consisted of approximately 59.5% oil and 40.5% natural gas.
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