TotalFinaElf, (NYSE: TOT) and Ecopetrol (NYSE:EC) are both large-cap oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, dividends, institutional ownership, risk and earnings.

Analyst Ratings

This is a breakdown of recent ratings and price targets for TotalFinaElf, and Ecopetrol, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
TotalFinaElf, 0 10 4 1 2.40
Ecopetrol 0 3 2 0 2.40

TotalFinaElf, currently has a consensus target price of $54.50, indicating a potential upside of 4.73%. Ecopetrol has a consensus target price of $10.33, indicating a potential upside of 11.35%. Given Ecopetrol’s higher probable upside, analysts plainly believe Ecopetrol is more favorable than TotalFinaElf,.

Volatility & Risk

TotalFinaElf, has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500. Comparatively, Ecopetrol has a beta of 1.04, meaning that its share price is 4% more volatile than the S&P 500.

Dividends

TotalFinaElf, pays an annual dividend of $2.34 per share and has a dividend yield of 4.5%. Ecopetrol pays an annual dividend of $0.16 per share and has a dividend yield of 1.7%. TotalFinaElf, pays out 80.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ecopetrol pays out 36.4% of its earnings in the form of a dividend.

Insider and Institutional Ownership

5.4% of TotalFinaElf, shares are owned by institutional investors. Comparatively, 2.1% of Ecopetrol shares are owned by institutional investors. 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.

Earnings and Valuation

This table compares TotalFinaElf, and Ecopetrol’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
TotalFinaElf, $139.27 billion 0.93 $21.80 billion $2.91 17.88
Ecopetrol $17.41 billion 1.10 $6.74 billion $0.44 21.09

TotalFinaElf, has higher revenue and earnings than Ecopetrol. TotalFinaElf, is trading at a lower price-to-earnings ratio than Ecopetrol, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares TotalFinaElf, and Ecopetrol’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
TotalFinaElf, 4.59% 9.07% 4.11%
Ecopetrol 5.04% 3.60% 1.34%

Summary

TotalFinaElf, beats Ecopetrol on 9 of the 15 factors compared between the two stocks.

About TotalFinaElf,

Total S.A. (Total) is an oil and gas company. The Company has three segments: an Upstream segment, including the activities of the exploration and production of hydrocarbons, and the activities of gas and power; a Refining & Chemicals segment constituting an industrial hub consisting of the activities of refining, petrochemicals and specialty chemicals, and also includes the activities of oil trading and shipping, and a Marketing & Services segment, including the activities of supply and marketing in the field of petroleum products, as well as the activity of New Energies. Its Corporate segment includes holdings operating and financial activities. The Company operates in the renewable energies and power generation sectors. It is engaged in various sectors of oil and gas industry, including upstream (hydrocarbon exploration, development and production) and downstream (refining, petrochemicals, specialty chemicals, trading and shipping of crude oil and petroleum products and marketing).

About Ecopetrol

Ecopetrol S.A. is an oil company. The Company operates in Colombia, Peru, Brazil and the United States Gulf Coast. The Company’s segments include Exploration and Production, Transportation and Logistics, and Refining, Petrochemicals and Biofuels. The Company’s Exploration and Production segment includes exploration, development and production activities in Colombia and abroad. The Company’s Transportation and Logistics segment includes the transportation of crude oil, motor fuels, fuel oil and other refined products, including diesel and biofuels. The Company’s main crude oil pipeline systems’ operating capacity is approximately 1.34 million barrels per day (BPD). The Company’s main refineries are the Barrancabermeja refinery, which it directly owns and operates, and a refinery in the Free Trade Zone in Cartagena that is operated by Reficar S.A., a subsidiary of the Company. The Company also owns and operates two other minor refineries: Orito and Apiay.

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