Head-To-Head Review: Enerplus (ERF) & Bill Barrett (BBG)

Enerplus (NYSE: ERF) and Bill Barrett (NYSE:BBG) are both oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, profitability, institutional ownership, dividends, valuation and risk.

Risk & Volatility

Enerplus has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, Bill Barrett has a beta of 3.59, suggesting that its stock price is 259% more volatile than the S&P 500.

Institutional & Insider Ownership

49.7% of Enerplus shares are held by institutional investors. Comparatively, 85.8% of Bill Barrett shares are held by institutional investors. 2.7% of Bill Barrett shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Enerplus and Bill Barrett’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Enerplus $545.68 million 3.76 $300.12 million $3.25 2.61
Bill Barrett $178.82 million 1.96 -$170.37 million ($1.60) -2.88

Enerplus has higher revenue and earnings than Bill Barrett. Bill Barrett is trading at a lower price-to-earnings ratio than Enerplus, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings for Enerplus and Bill Barrett, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Enerplus 0 0 5 0 3.00
Bill Barrett 1 6 6 0 2.38

Enerplus presently has a consensus price target of $15.00, suggesting a potential upside of 76.89%. Bill Barrett has a consensus price target of $6.63, suggesting a potential upside of 44.02%. Given Enerplus’ stronger consensus rating and higher possible upside, research analysts plainly believe Enerplus is more favorable than Bill Barrett.

Profitability

This table compares Enerplus and Bill Barrett’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Enerplus 121.44% 14.21% 8.42%
Bill Barrett -49.61% -7.59% -3.05%

Dividends

Enerplus pays an annual dividend of $0.09 per share and has a dividend yield of 1.1%. Bill Barrett does not pay a dividend. Enerplus pays out 2.8% of its earnings in the form of a dividend.

Summary

Enerplus beats Bill Barrett on 10 of the 15 factors compared between the two stocks.

About Enerplus

Enerplus Corporation is an oil and natural gas company. The Company’s oil and natural gas property interests are located in the United States, primarily in North Dakota, Montana, and Pennsylvania, as well as in western Canada in the provinces of Alberta, British Columbia and Saskatchewan. The Company’s oil and natural gas property interests contains proved plus probable gross reserves of approximately 14.3 million barrels (MMbbls) of light and medium crude oil, 39.0 MMbbls of heavy crude oil, 123 MMbbls of tight oil, 18.1 MMbbls of natural gas liquids (NGLs), 126.3 billion cubic feet (Bcf) of conventional natural gas and 1,002.8 Bcf of shale gas, for a total of approximately 382.5 million barrels of oil equivalent (MMBOE). The Company’s primary crude oil properties in the United States are located in the Fort Berthold region of North Dakota and in Richland County, Montana.

About Bill Barrett

Bill Barrett Corporation is an independent energy company that develops, acquires and explores for oil and natural gas resources. The Company’s assets and operations are located in the Rocky Mountain region of the United States. It has over two areas of production: The Denver-Julesburg Basin (DJ Basin) and the Uinta Oil Program in the Uinta Basin. Its acreage positions in the DJ Basin are located in Colorado’s eastern plains and parts of southeastern Wyoming. It had interests in 299 gross producing wells and served as an operator in 202 gross wells, as of December 31, 2016. The Uinta Basin is located in northeastern Utah. Uinta Basin’s estimated proved reserves are 21.4 million barrels of oil equivalent (MMBoe). Uinta Basin has interests in approximately 240 gross producing wells. The Company serves as an operator in over 170 gross wells. The Uinta Oil Program includes over three areas of development located in the basin referred as Blacktail Ridge, Lake Canyon and East Bluebell.

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