Head-To-Head Contrast: PetroChina Company Limited (NYSE:PTR) and Petroleo Brasileiro S.A.- Petrobras (PBR)

Petroleo Brasileiro S.A.- Petrobras (NYSE: PBR) and PetroChina Company Limited (NYSE:PTR) are both large-cap oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, profitability, valuation, analyst recommendations, dividends, earnings and institutional ownership.

Risk and Volatility

Petroleo Brasileiro S.A.- Petrobras has a beta of 2.45, indicating that its share price is 145% more volatile than the S&P 500. Comparatively, PetroChina Company Limited has a beta of 1.18, indicating that its share price is 18% more volatile than the S&P 500.

Earnings & Valuation

This table compares Petroleo Brasileiro S.A.- Petrobras and PetroChina Company Limited’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Petroleo Brasileiro S.A.- Petrobras $83.14 billion 0.38 $34.59 billion ($0.46) -18.43
PetroChina Company Limited $261.75 billion 0.05 $42.32 billion $2.28 27.81

PetroChina Company Limited has higher revenue and earnings than Petroleo Brasileiro S.A.- Petrobras. Petroleo Brasileiro S.A.- Petrobras 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.

Dividends

PetroChina Company Limited pays an annual dividend of $0.74 per share and has a dividend yield of 1.2%. Petroleo Brasileiro S.A.- Petrobras does not pay a dividend. PetroChina Company Limited pays out 32.5% of its earnings in the form of a dividend.

Profitability

This table compares Petroleo Brasileiro S.A.- Petrobras and PetroChina Company Limited’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Petroleo Brasileiro S.A.- Petrobras -3.64% 5.15% 1.68%
PetroChina Company Limited 1.57% 2.32% 1.32%

Institutional and Insider Ownership

6.3% of Petroleo Brasileiro S.A.- Petrobras shares are held by institutional investors. Comparatively, 0.2% of PetroChina Company Limited shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Petroleo Brasileiro S.A.- Petrobras and PetroChina Company Limited, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Petroleo Brasileiro S.A.- Petrobras 1 4 6 0 2.45
PetroChina Company Limited 0 3 4 0 2.57

Petroleo Brasileiro S.A.- Petrobras presently has a consensus target price of $10.81, suggesting a potential upside of 27.46%. Given Petroleo Brasileiro S.A.- Petrobras’ higher possible upside, analysts plainly believe Petroleo Brasileiro S.A.- Petrobras is more favorable than PetroChina Company Limited.

Summary

Petroleo Brasileiro S.A.- Petrobras beats PetroChina Company Limited on 8 of the 15 factors compared between the two stocks.

About Petroleo Brasileiro S.A.- Petrobras

Petroleo Brasileiro S.A.-Petrobras specializes in the oil, natural gas and energy industry. The Company is engaged in prospecting, drilling, refining, processing, trading and transporting crude oil from producing onshore and offshore oil fields and from shale or other rocks. Its segments include Exploration and Production, which covers the activities of exploration, development and production of crude oil, natural gas liquid and natural gas; Refining, Transportation and Marketing, which covers the refining, logistics, transport and trading of crude oil and oil products activities, exporting of ethanol, and extraction and processing of shale; Gas and Power, which is engaged in transportation and trading of natural gas produced in Brazil and imported natural gas; Biofuels, which covers the activities of production of biodiesel and its co-products, and ethanol-related activities; Distribution, which includes the activities of its subsidiary Petrobras Distribuidora S.A., and Corporate.

About PetroChina Company Limited

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.

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