Head-To-Head Analysis: Diversified Energy (NYSE:DEC) versus Zeo Energy (NASDAQ:ZEO)

Zeo Energy (NASDAQ:ZEO) and Diversified Energy (NYSE:DEC) are both energy companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, earnings and analyst recommendations.

Volatility & Risk

Zeo Energy has a beta of -0.13, suggesting that its share price is 113% less volatile than the S&P 500. Comparatively, Diversified Energy has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500.

Earnings & Valuation

This table compares Zeo Energy and Diversified Energy”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zeo Energy	$73.24 million	0.81	-$3.19 million	($0.75)	-1.37
Diversified Energy	$794.84 million	N/A	-$88.27 million	$1.47	8.78

Zeo Energy has higher earnings, but lower revenue than Diversified Energy. Zeo Energy is trading at a lower price-to-earnings ratio than Diversified Energy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Zeo Energy and Diversified Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zeo Energy	-17.91%	N/A	-23.34%
Diversified Energy	N/A	N/A	N/A

Institutional and Insider Ownership

26.5% of Diversified Energy shares are owned by institutional investors. 56.2% of Zeo Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Zeo Energy and Diversified Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zeo Energy	1	0	0	0	1.00
Diversified Energy	1	0	5	0	2.67

Diversified Energy has a consensus price target of $21.00, indicating a potential upside of 62.66%. Given Diversified Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Diversified Energy is more favorable than Zeo Energy.

Summary

Diversified Energy beats Zeo Energy on 10 of the 12 factors compared between the two stocks.

About Zeo Energy

Zeo Energy Corp. provides residential solar energy systems, other energy efficient equipment, and related services in Florida, Texas, Arkansas, and Missouri, the United States. The company is involved in the selling and installing of residential solar energy systems that homeowners use electricity required to power their homes. Its residential solar energy systems comprise solar panels, inverters, and racking systems. It also offers insulation services, such as adding insulation to a home's attic or walls; energy efficiency equipment, including hybrid electric water heaters and swimming pool pumps; battery-based energy storage systems; and roofing services. Zeo Energy Corp. was founded in 2005 and is headquartered in New Port Richey, Florida.

About Diversified Energy

Diversified Energy Company PLC operates as an independent owner and operator of producing natural gas and oil wells primarily in the Appalachian Basin of the United States. The company is involved in the production, marketing, and transportation of natural gas, natural gas liquids, crude oil, and condensates. Its assets consist of natural gas wells and gathering systems located in the states of Tennessee, Kentucky, Virginia, West Virginia, Ohio, Pennsylvania, Oklahoma, Texas, and Louisiana. The company was formerly known as Diversified Gas & Oil PLC and changed its name to Diversified Energy Company PLC in May 2021. Diversified Energy Company PLC was founded in 2001 and is headquartered in Birmingham, Alabama.