Marathon Oil (NYSE: MRO) and Enduro Royalty Trust (NYSE:NDRO) are both energy companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.
Earnings & Valuation
This table compares Marathon Oil and Enduro Royalty Trust’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Marathon Oil||$4.65 billion||2.76||-$2.14 billion||($2.56)||-5.89|
|Enduro Royalty Trust||$39.87 million||2.65||$8.48 million||$0.33||9.70|
This table compares Marathon Oil and Enduro Royalty Trust’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Enduro Royalty Trust||28.20%||9.68%||9.68%|
This is a summary of recent recommendations and price targets for Marathon Oil and Enduro Royalty Trust, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Enduro Royalty Trust||0||1||0||0||2.00|
Marathon Oil currently has a consensus price target of $16.87, suggesting a potential upside of 11.86%. Enduro Royalty Trust has a consensus price target of $4.00, suggesting a potential upside of 25.00%. Given Enduro Royalty Trust’s higher possible upside, analysts plainly believe Enduro Royalty Trust is more favorable than Marathon Oil.
Insider and Institutional Ownership
80.7% of Marathon Oil shares are held by institutional investors. Comparatively, 57.6% of Enduro Royalty Trust shares are held by institutional investors. 0.4% of Marathon Oil shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Marathon Oil pays an annual dividend of $0.20 per share and has a dividend yield of 1.3%. Enduro Royalty Trust pays an annual dividend of $0.04 per share and has a dividend yield of 1.3%. Marathon Oil pays out -7.8% of its earnings in the form of a dividend. Enduro Royalty Trust pays out 12.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Marathon Oil is clearly the better dividend stock, given its higher yield and lower payout ratio.
Risk & Volatility
Marathon Oil has a beta of 2.38, indicating that its stock price is 138% more volatile than the S&P 500. Comparatively, Enduro Royalty Trust has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500.
Marathon Oil beats Enduro Royalty Trust on 9 of the 15 factors compared between the two stocks.
About Marathon Oil
Marathon Oil Corporation is an exploration and production (E&P) company. The Company operates through three segments: North America E&P, International E&P and Oil Sands Mining. The North America E&P segment explores for, produces and markets crude oil and condensate, natural gas liquids (NGLs) and natural gas in North America. The International E&P segment explores for, produces and markets crude oil and condensate, NGLs and natural gas outside of North America, and produces and markets products manufactured from natural gas, such as liquefied natural gas (LNG) and methanol, in Equatorial Guinea (E.G.). The Oil Sands Mining segment mines, extracts and transports bitumen from oil sands deposits in Alberta, Canada, and upgrades the bitumen to produce and market synthetic crude oil and vacuum gas oil.
About Enduro Royalty Trust
Enduro Royalty Trust (the Trust) is a statutory trust formed by Enduro Resource Partners LLC (Enduro), as trustor, The Bank of New York Mellon Trust Company, N.A. (the Trustee), as trustee, and Wilmington Trust Company (the Delaware Trustee), as Delaware Trustee. The Trust was created to acquire and hold for the benefit of the Trust unitholders a net profits interest representing the right to receive approximately 80% of the net profits from the sale of oil and natural gas production from certain properties in the states of Texas, Louisiana and New Mexico held by Enduro as of the date of the conveyance of the net profits interest to the Trust (the Net Profits Interest). The properties in which the Trust holds the Net Profits Interest are referred to as the Underlying Properties. Enduro is engaged in the production and development of oil and natural gas. The Underlying Properties comprises producing and non-producing interests in oil and natural gas units, wells and lands.
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