Approach Resources (NASDAQ: AREX) is one of 246 publicly-traded companies in the “Oil & Gas Exploration and Production” industry, but how does it compare to its competitors? We will compare Approach Resources to related companies based on the strength of its risk, dividends, analyst recommendations, earnings, institutional ownership, profitability and valuation.
Volatility & Risk
Approach Resources has a beta of 2.76, meaning that its stock price is 176% more volatile than the S&P 500. Comparatively, Approach Resources’ competitors have a beta of 1.42, meaning that their average stock price is 42% more volatile than the S&P 500.
Institutional and Insider Ownership
24.3% of Approach Resources shares are held by institutional investors. Comparatively, 61.8% of shares of all “Oil & Gas Exploration and Production” companies are held by institutional investors. 5.1% of Approach Resources shares are held by insiders. Comparatively, 12.2% of shares of all “Oil & Gas Exploration and Production” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This table compares Approach Resources and its competitors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Approach Resources Competitors||-429.10%||-1.06%||2.08%|
Valuation and Earnings
This table compares Approach Resources and its competitors top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Approach Resources||$101.58 million||$49.31 million||-0.88|
|Approach Resources Competitors||$1.40 billion||$601.51 million||-1.05|
Approach Resources’ competitors have higher revenue and earnings than Approach Resources. Approach Resources is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.
This is a breakdown of recent ratings and target prices for Approach Resources and its competitors, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Approach Resources Competitors||1448||7500||12165||258||2.53|
Approach Resources presently has a consensus price target of $2.80, suggesting a potential upside of 20.17%. As a group, “Oil & Gas Exploration and Production” companies have a potential upside of 33.71%. Given Approach Resources’ competitors stronger consensus rating and higher possible upside, analysts clearly believe Approach Resources has less favorable growth aspects than its competitors.
Approach Resources competitors beat Approach Resources on 10 of the 12 factors compared.
Approach Resources Company Profile
Approach Resources Inc. is an independent energy company. The Company is focused on the exploration, development, production and acquisition of unconventional oil and gas reserves in the Midland Basin of the greater Permian Basin in West Texas. The Company’s business segment is the exploration and production of oil, natural gas liquids (NGLs) and natural gas. The Company’s assets cover an area of approximately 126,000 net acres. Its proved reserves are approximately 166.6 million barrels of oil equivalent. The Company’s proved reserves are primarily located in Crockett and Schleicher Counties, Texas. The Company’s Permian Basin acreage is known as the Project Pangea. The Company owns and operates approximately 800 producing oil and gas wells in the Permian Basin. The Company, through a joint venture with EnCana Oil & Gas (USA) Inc., holds interests in the approximately 3,000 gross acre project in Limestone and Robertson Counties, Texas, in the East Texas Cotton Valley trend.
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