Financial Contrast: Galp Energia SGPS (OTCMKTS:GLPEY) and BP (NYSE:BP)

BP (NYSE:BP) and Galp Energia SGPS (OTCMKTS:GLPEY) are both large-cap energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, analyst recommendations, institutional ownership and earnings.

Profitability

This table compares BP and Galp Energia SGPS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BP	3.74%	24.67%	6.42%
Galp Energia SGPS	4.55%	28.78%	9.53%

Insider and Institutional Ownership

11.0% of BP shares are held by institutional investors. 1.0% of BP shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for BP and Galp Energia SGPS, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BP	2	8	14	1	2.56
Galp Energia SGPS	0	5	3	1	2.56

BP presently has a consensus target price of $49.90, suggesting a potential upside of 11.95%. Given BP’s stronger consensus rating and higher probable upside, equities research analysts plainly believe BP is more favorable than Galp Energia SGPS.

Dividends

BP pays an annual dividend of $2.05 per share and has a dividend yield of 4.6%. Galp Energia SGPS pays an annual dividend of $0.18 per share and has a dividend yield of 1.7%. BP pays out 60.3% of its earnings in the form of a dividend. Galp Energia SGPS pays out 22.2% 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.

Valuation & Earnings

This table compares BP and Galp Energia SGPS”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BP	$237.14 billion	0.49	$55.00 million	$3.40	13.11
Galp Energia SGPS	$22.89 billion	0.63	$1.27 billion	$0.81	13.14

Galp Energia SGPS has lower revenue, but higher earnings than BP. BP is trading at a lower price-to-earnings ratio than Galp Energia SGPS, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

BP has a beta of 0.16, suggesting that its stock price is 84% less volatile than the S&P 500. Comparatively, Galp Energia SGPS has a beta of 0.07, suggesting that its stock price is 93% less volatile than the S&P 500.

Summary

BP beats Galp Energia SGPS on 9 of the 16 factors compared between the two stocks.

About BP

BP p.l.c. provides carbon products and services. The company operates through Gas & Low Carbon Energy, Oil Production & Operations, and Customers & Products segments. It engages in the production of natural gas, and integrated gas and power; trading of gas; operation of onshore and offshore wind power, as well as hydrogen and carbon capture and storage facilities; trading and marketing of renewable and non-renewable power; and production of crude oil. In addition, the company involved in convenience and retail fuel, EV charging, Castrol lubricant, aviation, B2B, and midstream businesses; refining and oil trading; and bioenergy business. The company was founded in 1908 and is headquartered in London, the United Kingdom.

About Galp Energia SGPS

Galp Energia, SGPS, S.A. operates as an integrated energy operator in Portugal and internationally. The company operates through four segments: Upstream, Industrial & Midstream, Commercial, and Renewables and New Business. The Upstream segment engages in the exploration, development, and production of hydrocarbons primarily in Brazil, Mozambique, Namibia, and Angola. The Industrial & Midstream segment owns refineries in Portugal, as well as is involved in activities related to energy management of oil products, gas, and electricity. This segment provides storage and transportation infrastructure for oil and gas products, as well as engages in the sale of electricity to the grid in Portugal and Spain. The Commercial segment is involved in the areas of retail to final business-to-business and business to consumer customers of oil, gas, and electricity. The Renewables and New Business segment is involved in the development of solar and wind power generation projects in Portugal and Spain. In addition, it produces lithium-ion batteries, hydrogen, and biofuels; and operates service stations. Further, the company engages in the reinsurance business. The company was formerly known as Galp Petróleos e Gás de Portugal, SGPS, S.A. and changed its name to Galp Energia, SGPS, S.A. in September 2000. Galp Energia, SGPS, S.A. was incorporated in 1999 and is headquartered in Lisbon, Portugal.