Contrasting Evolution Petroleum (NYSE:EPM) and Gran Tierra Energy (NYSE:GTE)

Evolution Petroleum (NYSE:EPM) and Gran Tierra Energy (NYSE:GTE) are both small-cap energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Institutional and Insider Ownership

60.1% of Evolution Petroleum shares are owned by institutional investors. Comparatively, 31.7% of Gran Tierra Energy shares are owned by institutional investors. 10.5% of Evolution Petroleum shares are owned by insiders. Comparatively, 6.5% of Gran Tierra Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Evolution Petroleum and Gran Tierra Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Evolution Petroleum	$85.23 million	1.68	$4.08 million	($0.01)	-412.00
Gran Tierra Energy	$614.07 million	0.27	-$6.29 million	($2.51)	-1.88

Evolution Petroleum has higher earnings, but lower revenue than Gran Tierra Energy. Evolution Petroleum is trading at a lower price-to-earnings ratio than Gran Tierra Energy, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and price targets for Evolution Petroleum and Gran Tierra Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Evolution Petroleum	0	2	3	0	2.60
Gran Tierra Energy	0	1	1	0	2.50

Evolution Petroleum presently has a consensus target price of $5.73, suggesting a potential upside of 39.16%. Given Evolution Petroleum’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Evolution Petroleum is more favorable than Gran Tierra Energy.

Volatility and Risk

Evolution Petroleum has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500. Comparatively, Gran Tierra Energy has a beta of 0.35, suggesting that its share price is 65% less volatile than the S&P 500.

Profitability

This table compares Evolution Petroleum and Gran Tierra Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Evolution Petroleum	2.04%	2.42%	1.20%
Gran Tierra Energy	7.17%	11.36%	3.28%

Summary

Evolution Petroleum beats Gran Tierra Energy on 9 of the 14 factors compared between the two stocks.

About Evolution Petroleum

Evolution Petroleum Corporation, an energy company, engages in the development, production, ownership, and exploitation of onshore oil and gas properties in the United States. The company holds a non-operated interests in the SCOOP and STACK plays located in Central Oklahoma; the Chaveroo Field situated in Chaves and Roosevelt Counties, New Mexico; the Jonah Field located in Sublette County, Wyoming; the Williston Basin situated in Williston, North Dakota; the Barnett Shale field located in North Texas; the Hamilton Dome situated in Hot Springs County, Wyoming; and the Delhi Field, an onshore CO2-EOR project located in northeast Louisiana in Franklin, Madison, and Richland Parishes, as well as small overriding royalty interests in four onshore central Texas wells. The company was founded in 2003 and is based in Houston, Texas.

About Gran Tierra Energy

Gran Tierra Energy Inc., together with its subsidiaries, engages in the exploration and production of oil and gas properties in Colombia and Ecuador. The company was founded in 2003 and is headquartered in Calgary, Canada.