Head to Head Analysis: EOG Resources (NYSE:EOG) vs. Southwestern Energy (NYSE:SWN)

EOG Resources (NYSE:EOG) and Southwestern Energy (NYSE:SWN) are both oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Insider and Institutional Ownership

89.9% of EOG Resources shares are owned by institutional investors. Comparatively, 87.0% of Southwestern Energy shares are owned by institutional investors. 0.3% of EOG Resources shares are owned by insiders. Comparatively, 0.6% of Southwestern Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares EOG Resources and Southwestern Energy’s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
EOG Resources	$24.01 billion	3.00	$7.59 billion	$12.66	9.89
Southwestern Energy	$6.52 billion	1.06	$1.56 billion	($1.74)	-3.61

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

Risk and Volatility

EOG Resources has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500. Comparatively, Southwestern Energy has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500.

Profitability

This table compares EOG Resources and Southwestern Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
EOG Resources	30.33%	25.65%	16.38%
Southwestern Energy	-48.91%	10.55%	4.80%

Analyst Recommendations

This is a summary of recent ratings and price targets for EOG Resources and Southwestern Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
EOG Resources	0	14	8	1	2.43
Southwestern Energy	1	10	2	0	2.08

EOG Resources currently has a consensus price target of $144.15, suggesting a potential upside of 15.09%. Southwestern Energy has a consensus price target of $8.27, suggesting a potential upside of 31.56%. Given Southwestern Energy’s higher probable upside, analysts clearly believe Southwestern Energy is more favorable than EOG Resources.

Summary

EOG Resources beats Southwestern Energy on 13 of the 15 factors compared between the two stocks.

About EOG Resources

EOG Resources, Inc., together with its subsidiaries, explores for, develops, produces, and markets crude oil, natural gas liquids, and natural gas primarily in producing basins in the United States, the Republic of Trinidad and Tobago and internationally. The company was formerly known as Enron Oil & Gas Company. EOG Resources, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.

About Southwestern Energy

Southwestern Energy Company, an independent energy company, engages in the exploration, development, and production of natural gas, oil, and natural gas liquids (NGLs) in the United States. It operates through two segments, Exploration and Production, and Marketing. The company focuses on the development of unconventional natural gas and oil reservoirs located in Pennsylvania, West Virginia, Ohio, and Louisiana. It also engages in the marketing and transportation of natural gas, oil, and NGLs. It serves LNG exporters, energy companies, utilities, and industrial purchasers of natural gas. Southwestern Energy Company was incorporated in 1929 and is headquartered in Spring, Texas.