Petroleo Brasileiro S.A.- Petrobras (NYSE:PBR – Get Free Report) and Diamondback Energy (NASDAQ:FANG – Get Free Report) are both large-cap energy companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.
Dividends
Petroleo Brasileiro S.A.- Petrobras pays an annual dividend of $0.43 per share and has a dividend yield of 2.1%. Diamondback Energy pays an annual dividend of $4.40 per share and has a dividend yield of 2.3%. Petroleo Brasileiro S.A.- Petrobras pays out 10.9% of its earnings in the form of a dividend. Diamondback Energy pays out 85.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Diamondback Energy has increased its dividend for 7 consecutive years. Diamondback Energy is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Ratings
This is a summary of current recommendations and price targets for Petroleo Brasileiro S.A.- Petrobras and Diamondback Energy, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Petroleo Brasileiro S.A.- Petrobras | 0 | 2 | 5 | 0 | 2.71 |
| Diamondback Energy | 0 | 5 | 16 | 4 | 2.96 |
Insider & Institutional Ownership
90.0% of Diamondback Energy shares are held by institutional investors. 0.6% of Diamondback Energy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Risk & Volatility
Petroleo Brasileiro S.A.- Petrobras has a beta of 0.32, suggesting that its stock price is 68% less volatile than the S&P 500. Comparatively, Diamondback Energy has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500.
Valuation and Earnings
This table compares Petroleo Brasileiro S.A.- Petrobras and Diamondback Energy”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Petroleo Brasileiro S.A.- Petrobras | $89.19 billion | 1.50 | $19.63 billion | $3.96 | 5.25 |
| Diamondback Energy | $15.03 billion | 3.59 | $1.66 billion | $5.13 | 37.51 |
Petroleo Brasileiro S.A.- Petrobras has higher revenue and earnings than Diamondback Energy. Petroleo Brasileiro S.A.- Petrobras is trading at a lower price-to-earnings ratio than Diamondback Energy, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Petroleo Brasileiro S.A.- Petrobras and Diamondback Energy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Petroleo Brasileiro S.A.- Petrobras | 24.52% | 30.61% | 10.94% |
| Diamondback Energy | 8.58% | 10.10% | 6.16% |
Summary
Diamondback Energy beats Petroleo Brasileiro S.A.- Petrobras on 12 of the 18 factors compared between the two stocks.
About Petroleo Brasileiro S.A.- Petrobras
Petróleo Brasileiro S.A. – Petrobras explores, produces, and sells oil and gas in Brazil and internationally. The company operates through three segments: Exploration and Production; Refining, Transportation and Marketing; and Gas and Power. The Exploration and Production segment explores, develops, and produces crude oil, natural gas liquids, and natural gas primarily for supplies to the domestic refineries. The Refining, Transportation and Marketing segment engages in the refining, logistics, transport, acquisition, and exports of crude oil; and production of fertilizers, as well as holding interests in petrochemical companies. The Gas and Power segment is involved in the logistic and trading of natural gas and electricity; transportation and trading of LNG; generation of electricity through thermoelectric power plants; renewable energy businesses; low carbon services; and natural gas processing business, as well as production of biodiesel and its co-products. The company also engages in prospecting, drilling, refining, processing, trading, and transporting crude oil from producing onshore and offshore oil fields, and shale or other rocks, as well as oil products, natural gas, and other liquid hydrocarbons. In addition, it engages in research, development, production, transport, distribution, and trading of energy. Petróleo Brasileiro S.A. – Petrobras was incorporated in 1953 and is headquartered in Rio de Janeiro, Brazil.
About Diamondback Energy
Diamondback Energy, Inc., an independent oil and natural gas company, acquires, develops, explores, and exploits unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas. It focuses on the development of the Spraberry and Wolfcamp formations of the Midland basin; and the Wolfcamp and Bone Spring formations of the Delaware basin, which are part of the Permian Basin in West Texas and New Mexico. The company also owns and operates midstream infrastructure assets, in the Midland and Delaware Basins of the Permian Basin. Diamondback Energy, Inc. was founded in 2007 and is headquartered in Midland, Texas.
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