PetroChina Company Limited (NYSE: PTR) and Royal Dutch Shell PLC (NYSE:RDS.A) are both large-cap oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.

Institutional and Insider Ownership

0.2% of PetroChina Company Limited shares are held by institutional investors. Comparatively, 6.4% of Royal Dutch Shell PLC shares are held by institutional investors. 1.0% of Royal Dutch Shell PLC shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares PetroChina Company Limited and Royal Dutch Shell PLC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PetroChina Company Limited 1.22% 2.08% 1.20%
Royal Dutch Shell PLC 3.71% 6.64% 3.13%

Valuation & Earnings

This table compares PetroChina Company Limited and Royal Dutch Shell PLC’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
PetroChina Company Limited $243.50 billion 0.54 $1.18 billion $1.90 37.61
Royal Dutch Shell PLC $233.59 billion 1.13 $4.58 billion $2.60 24.58

Royal Dutch Shell PLC has higher revenue, but lower earnings than PetroChina Company Limited. Royal Dutch Shell PLC is trading at a lower price-to-earnings ratio than PetroChina Company Limited, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations for PetroChina Company Limited and Royal Dutch Shell PLC, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PetroChina Company Limited 0 3 4 0 2.57
Royal Dutch Shell PLC 1 4 9 0 2.57

Royal Dutch Shell PLC has a consensus price target of $57.03, suggesting a potential downside of 10.75%. Given Royal Dutch Shell PLC’s higher possible upside, analysts clearly believe Royal Dutch Shell PLC is more favorable than PetroChina Company Limited.

Dividends

PetroChina Company Limited pays an annual dividend of $1.39 per share and has a dividend yield of 1.9%. Royal Dutch Shell PLC pays an annual dividend of $3.20 per share and has a dividend yield of 5.0%. PetroChina Company Limited pays out 73.2% of its earnings in the form of a dividend. Royal Dutch Shell PLC pays out 123.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility and Risk

PetroChina Company Limited has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500. Comparatively, Royal Dutch Shell PLC has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500.

Summary

Royal Dutch Shell PLC beats PetroChina Company Limited on 11 of the 15 factors compared between the two stocks.

PetroChina Company Limited Company Profile

PetroChina Company Limited is a China-based company principally engaged in the production and distribution of oil and gas. The Company mainly operates through four business segments. The Exploration and Production segment is principally engaged in the exploration, development, production and sales of crude oil and natural gas. The Refining and Chemical Products segment is principally engaged in the refining of crude oil and petroleum products, as well as the production and sales of basic petrochemical products, derivative petrochemical products and other chemical products. The Sales segment is principally engaged in the sales of refined petroleum products. The Natural Gas and Pipeline segment is engaged in the transportation and sales of natural gas, crude oil and refined petroleum products.

Royal Dutch Shell PLC Company Profile

The Royal Dutch Shell plc explores for crude oil and natural gas around the world, both in conventional fields and from sources, such as tight rock, shale and coal formations. The Company’s segments include Integrated Gas, Upstream, Downstream and Corporate. The Integrated Gas segment is engaged in the liquefaction and transportation of gas and the conversion of natural gas to liquids to provide fuels and other products, as well as projects with an integrated activity, ranging from producing to commercializing gas. The Upstream segment includes the operations of Upstream, which is engaged in the exploration for and extraction of crude oil, natural gas and natural gas liquids, and the marketing and transportation of oil and gas, and Oil Sands, which is engaged in the extraction of bitumen from mined oil sands and conversion into synthetic crude oil. The Downstream segment is engaged in oil products and chemicals manufacturing, and marketing activities.

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