Obsidian Energy (OBE) vs. Resolute Energy Corporation (REN) Financial Contrast

Resolute Energy Corporation (NYSE: REN) and Obsidian Energy (NYSE:OBE) are both small-cap oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, valuation, risk, earnings, profitability, institutional ownership and analyst recommendations.

Analyst Ratings

This is a summary of current ratings for Resolute Energy Corporation and Obsidian Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Resolute Energy Corporation 0 3 10 0 2.77
Obsidian Energy 0 6 1 0 2.14

Resolute Energy Corporation presently has a consensus target price of $43.55, suggesting a potential upside of 55.97%. Obsidian Energy has a consensus target price of $2.37, suggesting a potential upside of 179.25%. Given Obsidian Energy’s higher possible upside, analysts plainly believe Obsidian Energy is more favorable than Resolute Energy Corporation.

Risk & Volatility

Resolute Energy Corporation has a beta of 3.4, meaning that its stock price is 240% more volatile than the S&P 500. Comparatively, Obsidian Energy has a beta of 4.68, meaning that its stock price is 368% more volatile than the S&P 500.

Institutional and Insider Ownership

89.1% of Resolute Energy Corporation shares are owned by institutional investors. Comparatively, 19.4% of Obsidian Energy shares are owned by institutional investors. 7.3% of Resolute Energy Corporation shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Resolute Energy Corporation and Obsidian Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Resolute Energy Corporation -10.07% N/A -5.30%
Obsidian Energy -89.96% -18.75% -12.82%

Earnings and Valuation

This table compares Resolute Energy Corporation and Obsidian Energy’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Resolute Energy Corporation $246.34 million 2.50 $93.59 million ($1.99) -14.03
Obsidian Energy N/A N/A N/A ($0.66) -1.29

Resolute Energy Corporation has higher revenue and earnings than Obsidian Energy. Resolute Energy Corporation is trading at a lower price-to-earnings ratio than Obsidian Energy, indicating that it is currently the more affordable of the two stocks.

Summary

Resolute Energy Corporation beats Obsidian Energy on 8 of the 11 factors compared between the two stocks.

About Resolute Energy Corporation

Resolute Energy Corporation is an independent oil and gas company. The Company is engaged in the exploitation, development, exploration for and acquisition of oil and gas properties. The Company’s assets are located primarily in the Delaware Basin in west Texas (the Permian Properties or Permian Basin Properties) and Aneth Field located in the Paradox Basin in southeast Utah (the Aneth Field Properties or Aneth Field). The Company has an interest in gas gathering and compression facilities located within and adjacent to its Aneth Field Properties. The Aneth field is an oil field located in southeast Utah. The Aneth field is connected by pipeline to a refinery located near Gallup, New Mexico. As of December 31, 2016, the Company had interests in approximately 23,900 gross (20,000 net) acres in the Permian Basin of Texas and southeast New Mexico.

About Obsidian Energy

Obsidian Energy Ltd, formerly Penn West Petroleum Ltd, is a Canada-based conventional oil and natural gas producer and development and production company. The Company operates a portfolio of opportunities with an oil position in the Cardium, Viking and Peace River areas of Alberta. The Alberta Viking area offers a mix of light-oil and gas with high-netback shorter cycle wells to complement longer cycle activities in the Cardium. The Cardium is concentrated on the low-decline and high-netback light-oil production. The Company is focused on an integrated waterflood approach in which it maintain reservoir pressure from the start of production to reduce decline rates on new wells. The Peace River operates in a crude oil resource industry.

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