Evolution Petroleum Corp (NYSE: EPM) and Penn West Petroleum (NYSE:OBE) are both small-cap energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, profitabiliy, dividends, valuation, earnings, risk and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations for Evolution Petroleum Corp and Penn West Petroleum, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Evolution Petroleum Corp 0 1 3 0 2.75
Penn West Petroleum 0 6 1 0 2.14

Evolution Petroleum Corp currently has a consensus price target of $10.33, suggesting a potential upside of 30.80%. Penn West Petroleum has a consensus price target of $2.37, suggesting a potential upside of 144.33%. Given Penn West Petroleum’s higher probable upside, analysts plainly believe Penn West Petroleum is more favorable than Evolution Petroleum Corp.

Valuation and Earnings

This table compares Evolution Petroleum Corp and Penn West Petroleum’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Evolution Petroleum Corp $32.89 million 7.85 $18.80 million N/A N/A
Penn West Petroleum N/A N/A N/A ($0.66) -1.47

Evolution Petroleum Corp has higher revenue and earnings than Penn West Petroleum.

Profitability

This table compares Evolution Petroleum Corp and Penn West Petroleum’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Evolution Petroleum Corp 25.40% 14.11% 11.12%
Penn West Petroleum -89.96% -18.52% -12.42%

Insider and Institutional Ownership

19.7% of Penn West Petroleum shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Evolution Petroleum Corp beats Penn West Petroleum on 6 of the 8 factors compared between the two stocks.

Evolution Petroleum Corp Company Profile

Evolution Petroleum Corporation is an independent oil and gas company. The Company is engaged in the acquisition, exploitation and development of properties for the production of crude oil and natural gas, onshore in the United States. Its assets include interests in a carbon dioxide (CO2) enhanced oil recovery project (EOR) in Louisiana’s Delhi field. Its artificial lift technology is Gas Assisted Rod Pump (GARP). The Company tested GARP technology on marginal producing wells that it owns and operates in the Giddings Field. Its mineral interests include Delhi Holt-Bryant Unit in the Delhi field (Unit) located in Northeast Louisiana. As of June 30, 2016, the Unit was approximately 13,636 acres in size. As of June 30, 2016, the Unit produced approximately 195 million barrels of oil through primary and limited secondary recovery operations. As of June 30, 2016, the Unit had produced over 11 million barrels of oil. The Unit is producing as an EOR project utilizing CO2 flood technology.

Penn West Petroleum Company Profile

Obsidian Energy Ltd, formerly Penn West Petroleum Ltd, is a Canada-based conventional oil and natural gas producer and development and production company. The Company operates a portfolio of opportunities with an oil position in the Cardium, Viking and Peace River areas of Alberta. The Alberta Viking area offers a mix of light-oil and gas with high-netback shorter cycle wells to complement longer cycle activities in the Cardium. The Cardium is concentrated on the low-decline and high-netback light-oil production. The Company is focused on an integrated waterflood approach in which it maintain reservoir pressure from the start of production to reduce decline rates on new wells. The Peace River operates in a crude oil resource industry.

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