PDC Energy (NASDAQ: PDCE) and Transportadora De Gas Sa Ord B (NYSE:TGS) are both energy companies, but which is the better investment? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, earnings, profitability and institutional ownership.

Analyst Ratings

This is a summary of current recommendations for PDC Energy and Transportadora De Gas Sa Ord B, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PDC Energy 0 8 14 0 2.64
Transportadora De Gas Sa Ord B 1 0 1 0 2.00

PDC Energy presently has a consensus target price of $66.58, suggesting a potential upside of 20.01%. Transportadora De Gas Sa Ord B has a consensus target price of $25.00, suggesting a potential upside of 10.86%. Given PDC Energy’s stronger consensus rating and higher possible upside, research analysts clearly believe PDC Energy is more favorable than Transportadora De Gas Sa Ord B.

Profitability

This table compares PDC Energy and Transportadora De Gas Sa Ord B’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PDC Energy -159.65% -45.65% -26.18%
Transportadora De Gas Sa Ord B 21.43% 66.26% 22.54%

Volatility and Risk

PDC Energy has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500. Comparatively, Transportadora De Gas Sa Ord B has a beta of 1.14, meaning that its share price is 14% more volatile than the S&P 500.

Valuation & Earnings

This table compares PDC Energy and Transportadora De Gas Sa Ord B’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PDC Energy $382.92 million 9.54 -$245.92 million ($4.06) -13.67
Transportadora De Gas Sa Ord B $501.12 million 7.15 $63.00 million $0.76 29.67

Transportadora De Gas Sa Ord B has higher revenue and earnings than PDC Energy. PDC Energy is trading at a lower price-to-earnings ratio than Transportadora De Gas Sa Ord B, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

8.9% of Transportadora De Gas Sa Ord B shares are owned by institutional investors. 0.9% of PDC Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Transportadora De Gas Sa Ord B beats PDC Energy on 9 of the 14 factors compared between the two stocks.

About PDC Energy

PDC Energy, Inc. is an independent exploration and production company. The Company produces, develops, acquires and explores for crude oil, natural gas and natural gas liquids (NGLs) with operations in the Wattenberg Field in Colorado and the Utica Shale in southeastern Ohio. The Company operates through two segments: Oil and Gas Exploration and Production, and Gas Marketing. The Company’s Oil and Gas Exploration and Production segment includes all of its crude oil and natural gas properties. The Company’s Gas Marketing segment purchases, aggregates and resells natural gas. The Company’s operations in the Wattenberg Field are focused on the horizontal Niobrara and Codell plays. Its Delaware Basin operations are focused in the Wolfcamp zones and its Ohio operations are focused in the Utica Shale play. As of December 31, 2016, the Company owned an interest in approximately 2,900 productive gross wells.

About Transportadora De Gas Sa Ord B

Transportadora de Gas del Sur S.A. is engaged in the transportation of natural gas and production and commercialization of natural gas liquids (Liquids). The Company operates through four segments: Natural Gas Transportation Services, Liquids Production and Commercialization, Other Services and Telecommunications. The Company’s pipeline system connects gas fields in southern and western Argentina with gas distributors and industries in those areas and in the greater Buenos Aires area. It also provides midstream services, which consist of gas treatment, removal of impurities from the natural gas stream, gas compression, wellhead gas gathering and pipeline construction, operation and maintenance services. The Company transports gas through approximately 5,675 miles of pipeline, of which it owns 4,745 miles. It operates the remaining 930 miles, which are owned by the Gas Trusts.

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