Comparing Vermilion Energy (VET) & Laredo Petroleum (LPI)

Vermilion Energy (NYSE: VET) and Laredo Petroleum (NYSE:LPI) are both mid-cap oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.

Profitability

This table compares Vermilion Energy and Laredo Petroleum’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Vermilion Energy 4.45% 3.92% 1.56%
Laredo Petroleum 15.92% 47.82% 6.54%

Volatility & Risk

Vermilion Energy has a beta of 0.54, meaning that its stock price is 46% less volatile than the S&P 500. Comparatively, Laredo Petroleum has a beta of 1.39, meaning that its stock price is 39% more volatile than the S&P 500.

Insider and Institutional Ownership

53.7% of Vermilion Energy shares are held by institutional investors. 1.4% of Laredo Petroleum shares 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.

Dividends

Vermilion Energy pays an annual dividend of $2.06 per share. Laredo Petroleum does not pay a dividend. Vermilion Energy pays out 686.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Vermilion Energy has increased its dividend for 3 consecutive years.

Analyst Recommendations

This is a summary of recent ratings and target prices for Vermilion Energy and Laredo Petroleum, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Vermilion Energy 0 0 3 0 3.00
Laredo Petroleum 2 8 8 0 2.33

Vermilion Energy presently has a consensus target price of $52.25, suggesting a potential upside of Infinity. Laredo Petroleum has a consensus target price of $14.52, suggesting a potential upside of 35.81%. Given Vermilion Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Vermilion Energy is more favorable than Laredo Petroleum.

Earnings and Valuation

This table compares Vermilion Energy and Laredo Petroleum’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Vermilion Energy $666.64 0.00 -$120.87 $0.30 N/A
Laredo Petroleum $597.38 4.34 -$260.73 $0.50 21.38

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

Summary

Laredo Petroleum beats Vermilion Energy on 8 of the 15 factors compared between the two stocks.

About Vermilion Energy

Vermilion Energy Inc. produces oil and gas, and focuses on the acquisition, development and optimization of producing properties in North America, the Europe and Australia. Its segments include Canada, which includes production and assets focused in West Pembina near Drayton Valley, Alberta and Northgate in southeast Saskatchewan; France, which produces oil in France; Netherlands, which produces onshore gas and interests include over 24 onshore licenses and two offshore licenses; Germany, which holds interest in a four partner consortium; Ireland, which includes a non-operating interest in the offshore Corrib gas field located approximately 83 kilometers off the northwest coast of Ireland; Australia, which holds an operated working interest in the Wandoo field located approximately 80 kilometers offshore on the northwest shelf of Australia; the United States, which has interests in approximately 97,200 net acres of land in the Powder River Basin of northeastern Wyoming, and Corporate.

About Laredo Petroleum

Laredo Petroleum, Inc. (Laredo) is an independent energy company. The Company is focused on the acquisition, exploration and development of oil and natural gas properties, and the transportation of oil and natural gas from such properties primarily in the Permian Basin in West Texas. It operates through two segments: Exploration and production of oil and natural gas properties, and Midstream and marketing. The exploration and production of oil and natural gas properties are conducted by it through the exploration and development of its acreage in the Permian Basin. As of December 31, 2016, it had assembled 127,847 net acres in the Permian Basin and had total proved reserves, presented on a three-stream basis, of 167,100 thousand of barrels of oil equivalent (MBOE). The Midstream and marketing segment’s operations are conducted by its subsidiary, Laredo Midstream Services, LLC, which buys, sells, gathers and transports oil, natural gas and water primarily for the account of Laredo.

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