Centennial Res (CDEV) and InterOil (NYSE:IOC) Critical Contrast

Centennial Res (NASDAQ: CDEV) and InterOil (NYSE:IOC) are both oils/energy companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, earnings and profitability.

Earnings and Valuation

This table compares Centennial Res and InterOil’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Centennial Res $212.53 million 19.58 $133.00 million N/A N/A
InterOil N/A N/A N/A ($3.70) -13.07

Centennial Res has higher revenue and earnings than InterOil.

Institutional & Insider Ownership

46.6% of InterOil shares are held by institutional investors. 44.7% of Centennial Res shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings for Centennial Res and InterOil, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Centennial Res 0 1 11 0 2.92
InterOil 0 0 0 0 N/A

Centennial Res currently has a consensus target price of $22.55, indicating a potential upside of 39.08%. Given Centennial Res’ higher possible upside, research analysts plainly believe Centennial Res is more favorable than InterOil.

Volatility & Risk

Centennial Res has a beta of 2.14, suggesting that its stock price is 114% more volatile than the S&P 500. Comparatively, InterOil has a beta of 1.67, suggesting that its stock price is 67% more volatile than the S&P 500.

Profitability

This table compares Centennial Res and InterOil’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Centennial Res N/A -8.27% -7.48%
InterOil -233.48% -14.08% -8.85%

Summary

Centennial Res beats InterOil on 8 of the 9 factors compared between the two stocks.

About Centennial Res

Centennial Resource Development, Inc. is an independent oil and natural gas company. The Company is focused on the development of unconventional oil and associated liquids-rich natural gas reserves in the Permian Basin. The Company’s assets are concentrated in the Delaware Basin, a sub-basin of the Permian Basin. Its properties consist of large, contiguous acreage blocks in Reeves, Ward and Pecos counties in West Texas. As of December 31, 2016, the Company held approximately 92% membership interest in Centennial Resource Production, LLC (CRP). As of December 31, 2016, its portfolio included 106 operated producing horizontal wells. The horizontal wells span an area of approximately 45 miles long by 20 miles wide where it had commercial production in five zones: the 3rd Bone Spring Sandstone, Upper Wolfcamp A, Lower Wolfcamp A, Wolfcamp B and Wolfcamp C.

About InterOil

InterOil Corporation (InterOil) is an oil and gas business with a sole focus on Papua New Guinea (PNG). The Company’s segments include Upstream and Corporate. The Upstream segment includes exploration, appraisal and development of hydrocarbon structures in PNG. The Corporate segment provides support to the Company’s other business segments through business development and improvement activities, general services, administration, human resources, executive management, financing and treasury, government affairs and investor relations. InterOil holds interests across over four exploration and approximately two production retention licenses in the Eastern Papuan Basin of Papua New Guinea. Its assets include the Elk, Antelope, Triceratops, Raptor and Bobcat fields in the Gulf Province of Papua New Guinea, and exploration licenses covering approximately 16,000 square kilometers (over four million acres) in Papua New Guinea.

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