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

Profitability

This table compares Atlas Energy Group and Stone Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Atlas Energy Group -676.76% N/A -64.37%
Stone Energy 68.43% 590.23% 37.33%

Analyst Recommendations

This is a summary of recent recommendations for Atlas Energy Group and Stone Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Atlas Energy Group 0 0 0 0 N/A
Stone Energy 0 3 1 0 2.25

Stone Energy has a consensus price target of $5.08, indicating a potential downside of 80.01%. Given Stone Energy’s higher probable upside, analysts clearly believe Stone Energy is more favorable than Atlas Energy Group.

Insider and Institutional Ownership

0.4% of Atlas Energy Group shares are owned by institutional investors. Comparatively, 97.1% of Stone Energy shares are owned by institutional investors. 12.4% of Atlas Energy Group shares are owned by company insiders. Comparatively, 3.5% of Stone Energy shares are owned by company insiders. 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.

Valuation & Earnings

This table compares Atlas Energy Group and Stone Energy’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Atlas Energy Group $137.16 million 0.01 -$13.10 million ($0.77) -0.05
Stone Energy $377.39 million 1.35 -$590.58 million N/A N/A

Atlas Energy Group has higher earnings, but lower revenue than Stone Energy.

Summary

Stone Energy beats Atlas Energy Group on 8 of the 10 factors compared between the two stocks.

Atlas Energy Group Company Profile

Atlas Energy Group, LLC is an energy management company, which acquires and develops upstream and midstream oil and gas assets. The Company has ownership interests in the general partner Class A units, and over 23.3% limited partner interest in Atlas Resource Partners, L.P. (ARP), which is an independent developer and producer of natural gas, crude oil and natural gas liquids; over 80% general partner interest and approximately 2.1% limited partner interest in Atlas Growth Partners, L.P. (AGP), which conducts natural gas and oil operations in the mid-continent region of the United States, and owns approximately 15.9% general partner interest and over 12% limited partner interest in Lightfoot Capital Partners, L.P. and Lightfoot Capital Partners GP, LLC, its general partner, which incubates new master limited partnerships (MLPs) and invests in existing MLPs. Its segments include ARP, AGP, and Corporate and other. The Company focuses on the development and growth of energy enterprises.

Stone Energy Company Profile

Stone Energy Corporation is an independent oil and natural gas company. The Company is engaged in the acquisition, exploration, exploitation, development and operation of oil and gas properties. The Company operates in the Gulf of Mexico (GOM) basin. It has leveraged its operations in the GOM conventional shelf and has its reserve base in the prolific basins of the GOM deep water, Gulf Coast deep gas, and the Marcellus and Utica shales in Appalachia. Its estimated proved oil and natural gas reserves are over 60 million barrels of oil equivalents (MMBoe) or 340 billion cubic feet equivalent (Bcfe). Over 95 MMBoe or 570 Bcfe of its estimated proved reserves are revised downward. It has made investments in seismic data and leasehold interests, and has geological, geophysical, engineering and operational operations in deep water arena to evaluate potential exploration, development and acquisition opportunities. It holds over two deep water platforms, producing reserves and various leases.

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