ConocoPhillips (NYSE: COP) and Murphy Oil Corporation (NYSE:MUR) are both mid-cap oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, analyst recommendations, earnings and valuation.

Insider & Institutional Ownership

70.2% of ConocoPhillips shares are held by institutional investors. Comparatively, 98.3% of Murphy Oil Corporation shares are held by institutional investors. 0.8% of ConocoPhillips shares are held by insiders. Comparatively, 6.9% of Murphy Oil Corporation shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares ConocoPhillips and Murphy Oil Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ConocoPhillips -7.32% 0.12% 0.05%
Murphy Oil Corporation -4.15% -1.25% -0.61%

Dividends

ConocoPhillips pays an annual dividend of $1.06 per share and has a dividend yield of 2.0%. Murphy Oil Corporation pays an annual dividend of C$1.00 per share and has a dividend yield of 3.4%. ConocoPhillips pays out -57.3% of its earnings in the form of a dividend. Murphy Oil Corporation pays out -196.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Murphy Oil Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares ConocoPhillips and Murphy Oil Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
ConocoPhillips $24.36 billion 2.60 -$3.62 billion ($1.85) -28.64
Murphy Oil Corporation $1.87 billion 2.68 -$275.97 million C($0.51) -57.14

Murphy Oil Corporation has higher revenue, but lower earnings than ConocoPhillips. Murphy Oil Corporation is trading at a lower price-to-earnings ratio than ConocoPhillips, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for ConocoPhillips and Murphy Oil Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ConocoPhillips 1 7 12 1 2.62
Murphy Oil Corporation 2 7 1 0 1.90

ConocoPhillips presently has a consensus price target of $55.63, suggesting a potential upside of 4.97%. Murphy Oil Corporation has a consensus price target of C$30.50, suggesting a potential upside of 4.67%. Given ConocoPhillips’ stronger consensus rating and higher probable upside, equities analysts clearly believe ConocoPhillips is more favorable than Murphy Oil Corporation.

Volatility and Risk

ConocoPhillips has a beta of 1.28, suggesting that its share price is 28% more volatile than the S&P 500. Comparatively, Murphy Oil Corporation has a beta of 2.23, suggesting that its share price is 123% more volatile than the S&P 500.

Summary

Murphy Oil Corporation beats ConocoPhillips on 9 of the 16 factors compared between the two stocks.

About ConocoPhillips

ConocoPhillips is an independent exploration and production company. The Company explores for, produces, transports and markets crude oil, bitumen, natural gas, liquefied natural gas (LNG) and natural gas liquids. The Company operates through five segments: Alaska, Lower 48, Canada, Europe and North Africa, Asia Pacific and Middle East, and Other International. The Alaska segment explores for, produces, transports and markets crude oil, natural gas liquids, natural gas and LNG. The Lower 48 segment consists of operations located in the United States Lower 48 states and the Gulf of Mexico. Its Canadian operations consists of oil sands developments in the Athabasca Region of northeastern Alberta. The Europe and North Africa segment consists of operations and exploration activities in Norway, the United Kingdom and Libya. The Asia Pacific and Middle East segment has exploration and production operations in China, Indonesia, Malaysia and Australia.

About Murphy Oil Corporation

Murphy Oil Corporation (Murphy) is an oil and gas exploration and production company. The Company’s exploration and production business explores for and produces crude oil, natural gas and natural gas liquids across the world. Its exploration and production activities are subdivided into four geographic segments: the United States, Canada, Malaysia and all other countries. It explores for and produces crude oil, natural gas and natural gas liquids around the world. This business maintains upstream operating offices in several locations around the world, including Houston, Texas, Calgary, Alberta, and Kuala Lumpur, Malaysia. As of December 31, 2016, Murphy’s principal exploration and production activities were conducted in the United States by Murphy Exploration & Production Company-USA (Murphy Expro USA), in Malaysia, Australia, Brunei, and Vietnam by Murphy Exploration & Production Company-International (Murphy Expro International) and its subsidiaries, and in Western Canada.

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