Contrasting ENI S.p.A. (E) and Royal Dutch Shell PLC (RDS.A)

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

Earnings and Valuation

This table compares ENI S.p.A. and Royal Dutch Shell PLC’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
ENI S.p.A. $74.04 billion 0.77 $13.07 billion $0.41 76.44
Royal Dutch Shell PLC N/A N/A N/A $1.96 N/A

ENI S.p.A. has higher revenue and earnings than Royal Dutch Shell PLC. Royal Dutch Shell PLC is trading at a lower price-to-earnings ratio than ENI S.p.A., indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for ENI S.p.A. and Royal Dutch Shell PLC, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ENI S.p.A. 4 3 4 0 2.00
Royal Dutch Shell PLC 2 3 11 0 2.56

Royal Dutch Shell PLC has a consensus price target of $57.00, suggesting a potential upside of Infinity. Given Royal Dutch Shell PLC’s stronger consensus rating and higher probable upside, analysts clearly believe Royal Dutch Shell PLC is more favorable than ENI S.p.A..

Profitability

This table compares ENI S.p.A. and Royal Dutch Shell PLC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ENI S.p.A. 1.14% 2.23% 0.94%
Royal Dutch Shell PLC 2.91% 6.04% 2.80%

Dividends

ENI S.p.A. pays an annual dividend of $1.27 per share and has a dividend yield of 4.1%. Royal Dutch Shell PLC pays an annual dividend of $3.20 per share. ENI S.p.A. pays out 309.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Royal Dutch Shell PLC pays out 163.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Risk and Volatility

ENI S.p.A. has a beta of 0.77, suggesting that its stock price is 23% less volatile than the S&P 500. Comparatively, Royal Dutch Shell PLC has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500.

Institutional and Insider Ownership

1.7% of ENI S.p.A. shares are held by institutional investors. Comparatively, 6.3% of Royal Dutch Shell PLC shares are held by institutional investors. 1.0% of Royal Dutch Shell PLC shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Royal Dutch Shell PLC beats ENI S.p.A. on 11 of the 14 factors compared between the two stocks.

About ENI S.p.A.

Eni SpA (Eni) is an Italy-based company engaged in the exploration, development and production of hydrocarbons, in the supply and marketing of gas, liquefied natural gas (LNG) and power, in the refining and marketing of petroleum products, in the production and marketing of basic petrochemicals, plastics and elastomers and in commodity trading. The Company’s segments include Exploration & Production, Gas & Power, and Refining & Marketing. Its Exploration & Production segment engages in oil and natural gas exploration and field development and production, as well as LNG operations in over 40 countries, including Italy, Libya, Egypt, Norway, the United Kingdom, Angola, Congo, Nigeria, the United States, Kazakhstan, Algeria, Australia, Venezuela, Iraq, Ghana and Mozambique. Its Gas & Power segment engages in supply, trading and marketing of gas, LNG and electricity, international gas transport activities and commodity trading and derivatives.

About Royal Dutch Shell PLC

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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