Critical Analysis: Cenovus Energy (CVE) versus QEP Resources (QEP)
Cenovus Energy (NYSE: CVE) and QEP Resources (NYSE:QEP) are both mid-cap oils/energy companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, risk, analyst recommendations, profitability, dividends, earnings and valuation.
Earnings & Valuation
This table compares Cenovus Energy and QEP Resources’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Cenovus Energy||$9.09 billion||1.32||-$411.58 million||$1.98||4.93|
|QEP Resources||$1.38 billion||1.65||-$1.25 billion||($0.06)||-157.14|
Cenovus Energy has higher revenue and earnings than QEP Resources. QEP Resources is trading at a lower price-to-earnings ratio than Cenovus Energy, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Cenovus Energy has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500. Comparatively, QEP Resources has a beta of 1.7, indicating that its stock price is 70% more volatile than the S&P 500.
This table compares Cenovus Energy and QEP Resources’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of current recommendations and price targets for Cenovus Energy and QEP Resources, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Cenovus Energy presently has a consensus price target of $16.79, indicating a potential upside of 71.81%. QEP Resources has a consensus price target of $14.43, indicating a potential upside of 53.01%. Given Cenovus Energy’s higher possible upside, equities analysts clearly believe Cenovus Energy is more favorable than QEP Resources.
Insider & Institutional Ownership
55.9% of Cenovus Energy shares are owned by institutional investors. Comparatively, 88.4% of QEP Resources shares are owned by institutional investors. 1.4% of QEP Resources 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.
Cenovus Energy pays an annual dividend of $0.16 per share and has a dividend yield of 1.6%. QEP Resources does not pay a dividend. Cenovus Energy pays out 8.1% of its earnings in the form of a dividend.
About Cenovus Energy
Cenovus Energy Inc is a Canada-based integrated oil company. It operates in the business of developing, producing and marketing crude oil, Natural Gas Liquids (NGLs) and natural gas in Canada. The Company also conducts marketing activities and owns refining interests in the United States (U.S.). Its segments include: Oil Sands, which includes the development and production of bitumen and natural gas in northeast Alberta; Conventional, which includes the development and production of conventional crude oil, NGLs and natural gas in Alberta and Saskatchewan, including the heavy oil assets at Pelican Lake, the carbon dioxide (CO2) enhanced oil recovery (EOR) project at Weyburn and emerging tight oil opportunities; Refining and Marketing, which includes transporting and selling crude oil and natural gas and joint ownership of refineries in the U.S., as well as Corporate and Eliminations.
About QEP Resources
QEP Resources, Inc. is an independent crude oil and natural gas exploration and production company. The Company focuses on two regions of the United States: the Northern Region (primarily in North Dakota, Wyoming and Utah) and the Southern Region (primarily in Texas and Louisiana). The Company conducts exploration and production activities in North America’s hydrocarbon resource plays. The Company has an inventory of developed and undeveloped drilling locations in the Permian Basin in western Texas, the Williston Basin in North Dakota, Haynesville/Cotton Valley in northwestern Louisiana, the Uinta Basin in eastern Utah and other properties in Wyoming, Utah and Colorado. It sells gas volumes to wholesale marketers, industrial users, local distribution companies and utilities. It sells oil and natural gas liquid (NGL) volumes to refiners, marketers and other companies.
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