Reviewing CNOOC Limited (CEO) and Approach Resources (AREX)
CNOOC Limited (NYSE: CEO) and Approach Resources (NASDAQ:AREX) are both oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.
This table compares CNOOC Limited and Approach Resources’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk & Volatility
CNOOC Limited has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500. Comparatively, Approach Resources has a beta of 2.78, suggesting that its share price is 178% more volatile than the S&P 500.
Institutional and Insider Ownership
1.5% of CNOOC Limited shares are held by institutional investors. Comparatively, 24.3% of Approach Resources shares are held by institutional investors. 7.8% of Approach Resources shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Valuation & Earnings
This table compares CNOOC Limited and Approach Resources’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|CNOOC Limited||$25.97 billion||2.05||$14.25 billion||N/A||N/A|
|Approach Resources||$101.58 million||2.32||$49.31 million||($2.64)||-1.03|
CNOOC Limited has higher revenue and earnings than Approach Resources.
This is a breakdown of current ratings and price targets for CNOOC Limited and Approach Resources, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
CNOOC Limited presently has a consensus price target of $131.00, indicating a potential upside of 9.88%. Approach Resources has a consensus price target of $3.10, indicating a potential upside of 13.55%. Given Approach Resources’ higher possible upside, analysts plainly believe Approach Resources is more favorable than CNOOC Limited.
CNOOC Limited pays an annual dividend of $4.91 per share and has a dividend yield of 4.1%. Approach Resources does not pay a dividend.
CNOOC Limited beats Approach Resources on 8 of the 13 factors compared between the two stocks.
CNOOC Limited Company Profile
CNOOC Limited is a Hong Kong-based investment holding company principally engaged in the exploration, production and trading of oil and gas. Its businesses include conventional oil and gas businesses, shale oil and gas businesses, oil sands businesses and other unconventional oil and gas businesses. The Company mainly operates businesses through three segments. The Exploration and Production segment is engaged in the exploration, development and production of crude oil, natural gas and other petroleum products. The Trading segment is engaged in the trading of crude oil, natural gas and other petroleum products. The Corporate segment is engaged in corporate-related businesses. The Company mainly operates businesses in China, Canada, the United Kingdom, Nigeria, Indonesia and Brazil, among others.
Approach Resources Company Profile
Approach Resources Inc. is an independent energy company. The Company is focused on the exploration, development, production and acquisition of unconventional oil and gas reserves in the Midland Basin of the greater Permian Basin in West Texas. The Company’s business segment is the exploration and production of oil, natural gas liquids (NGLs) and natural gas. The Company’s assets cover an area of approximately 126,000 net acres. Its proved reserves are approximately 166.6 million barrels of oil equivalent. The Company’s proved reserves are primarily located in Crockett and Schleicher Counties, Texas. The Company’s Permian Basin acreage is known as the Project Pangea. The Company owns and operates approximately 800 producing oil and gas wells in the Permian Basin. The Company, through a joint venture with EnCana Oil & Gas (USA) Inc., holds interests in the approximately 3,000 gross acre project in Limestone and Robertson Counties, Texas, in the East Texas Cotton Valley trend.
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