Murphy Oil (NYSE:MUR) & Zion Oil & Gas (OTCMKTS:ZNOG) Critical Analysis

Zion Oil & Gas (OTCMKTS:ZNOG) and Murphy Oil (NYSE:MUR) are both energy companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, dividends, risk, profitability, analyst recommendations and institutional ownership.

Earnings & Valuation

This table compares Zion Oil & Gas and Murphy Oil”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zion Oil & Gas	N/A	N/A	-$7.34 million	($1.77)	-0.22
Murphy Oil	$3.03 billion	1.49	$407.17 million	$0.98	32.25

Murphy Oil has higher revenue and earnings than Zion Oil & Gas. Zion Oil & Gas is trading at a lower price-to-earnings ratio than Murphy Oil, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Zion Oil & Gas and Murphy Oil’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zion Oil & Gas	N/A	-19.89%	-18.12%
Murphy Oil	5.16%	4.30%	2.34%

Volatility & Risk

Zion Oil & Gas has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500. Comparatively, Murphy Oil has a beta of 0.78, meaning that its stock price is 22% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Zion Oil & Gas and Murphy Oil, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zion Oil & Gas	0	0	0	0	0.00
Murphy Oil	2	13	0	0	1.87

Murphy Oil has a consensus target price of $30.00, indicating a potential downside of 5.08%. Given Murphy Oil’s stronger consensus rating and higher probable upside, analysts plainly believe Murphy Oil is more favorable than Zion Oil & Gas.

Institutional and Insider Ownership

7.9% of Zion Oil & Gas shares are held by institutional investors. Comparatively, 78.3% of Murphy Oil shares are held by institutional investors. 2.7% of Zion Oil & Gas shares are held by company insiders. Comparatively, 6.5% of Murphy Oil shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Murphy Oil beats Zion Oil & Gas on 12 of the 12 factors compared between the two stocks.

About Zion Oil & Gas

Zion Oil & Gas, Inc., together with its subsidiaries, operates as an oil and gas exploration company in Israel. It holds a petroleum exploration license onshore Israel, the New Megiddo License 434 comprising an area of approximately 75,000 acres. The company was incorporated in 2000 and is headquartered in Dallas, Texas.

About Murphy Oil

Murphy Oil Corporation, together with its subsidiaries, operates as an oil and gas exploration and production company in the United States, Canada, and internationally. It explores for and produces crude oil, natural gas, and natural gas liquids. The company was formerly known as Murphy Corporation and changed its name to Murphy Oil Corporation in 1964. The company was incorporated in 1950 and is headquartered in Houston, Texas.