Critical Analysis: YPF (YPF) and Equinor ASA (EQNR)

YPF (NYSE: YPF) and Equinor ASA (NYSE:EQNR) are both oils/energy companies, but which is the better investment? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, risk, earnings, dividends and analyst recommendations.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for YPF and Equinor ASA, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
YPF 0 3 3 1 2.71
Equinor ASA 0 3 1 0 2.25

YPF currently has a consensus price target of $27.94, suggesting a potential upside of 79.89%. Given YPF’s stronger consensus rating and higher probable upside, equities analysts clearly believe YPF is more favorable than Equinor ASA.

Profitability

This table compares YPF and Equinor ASA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
YPF 6.54% 12.10% 3.58%
Equinor ASA 6.69% 13.09% 4.68%

Institutional and Insider Ownership

26.8% of YPF shares are held by institutional investors. Comparatively, 4.9% of Equinor ASA shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Dividends

Equinor ASA pays an annual dividend of $0.67 per share and has a dividend yield of 2.5%. YPF does not pay a dividend. Equinor ASA pays out 48.6% of its earnings in the form of a dividend. YPF has raised its dividend for 2 consecutive years.

Earnings & Valuation

This table compares YPF and Equinor ASA’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
YPF $15.27 billion 0.40 $745.33 million $1.90 8.17
Equinor ASA $61.19 billion 1.44 $4.59 billion $1.38 19.16

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

Risk & Volatility

YPF has a beta of 1.97, suggesting that its stock price is 97% more volatile than the S&P 500. Comparatively, Equinor ASA has a beta of 0.9, suggesting that its stock price is 10% less volatile than the S&P 500.

Summary

YPF beats Equinor ASA on 9 of the 17 factors compared between the two stocks.

About YPF

YPF Sociedad Anonima, an energy company, operates in the oil and gas upstream and downstream activities in Argentina. The company involved in the exploration, development, and production of crude oil, natural gas, and liquefied petroleum gas (LPG). It is also engages in the refining, marketing, transportation, and distribution of oil, petroleum products, petroleum derivatives, petrochemicals, LPG, and bio-fuels, as well as in gas separation and natural gas distribution operations. As of December 31, 2017, it had interests in approximately 112 oil and gas fields; proved reserves of approximately 480 million barrels (mmbbl) of oil; and approximately 2,520 billion cubic feet of gas. The company also had a retail distribution network of 1,563 YPF-branded service stations; 21 exploration permits, including 18 onshore and 3 offshore exploration permits, as well as 112 production concessions; and 36 crude oil treatment plants and 10 pumping plants. In addition, it owns three refineries with annual refining capacity of approximately 116 mmbbl; approximately 2,700 kilometers of crude oil pipelines with approximately 640,000 barrels of aggregate daily transportation capacity of refined products; and crude oil tankage of approximately 7 mmbbl, as well as maintains terminal facilities at 5 Argentine ports. Further, the company participates in 3 power generation plants with an aggregate installed capacity of 1,367 megawatts; offers diesel, fertilizers, lubricants, phytosanitaries, ensiling bags, and other products; and supplies fuels, lubricants, coal, asphalts, and paraffin and derivatives. YPF Sociedad Anonima was founded in 1977 and is headquartered in Buenos Aires, Argentina.

About Equinor ASA

Equinor ASA, an energy company, explores for, produces, transports, refines, and markets petroleum and petroleum-derived products, and other forms of energy in Norway and internationally. The company operates through Development & Production Norway; Development & Production USA; Development & Production International; Marketing, Midstream & Processing; New Energy Solutions; Technology, Projects & Drilling; Exploration; and Global Strategy & Business Development segments. It also transports, processes, manufactures, markets, and trades in oil and gas commodities, such as crude and condensate products, gas liquids, natural gas, and liquefied natural gas; markets and trades in electricity and emission rights; and operates refineries, processing and power plants, and terminals. In addition, the company develops wind, and carbon capture and storage projects, as well as offers other renewable energy and low-carbon energy solutions. As of December 31, 2017, it had proved oil and gas reserves of 5,367 million barrels of oil equivalent. The company was formerly known as Statoil ASA and changed its name to Equinor ASA in May 2018. Equinor ASA was founded in 1972 and is headquartered in Stavanger, Norway.

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