Charah Solutions (NYSE:CHRA) and Laredo Petroleum (NYSE:LPI) are both small-cap oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, valuation and dividends.
Analyst Recommendations
This is a summary of current recommendations and price targets for Charah Solutions and Laredo Petroleum, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Charah Solutions | 1 | 0 | 0 | 0 | 1.00 |
| Laredo Petroleum | 1 | 3 | 4 | 0 | 2.38 |
Charah Solutions presently has a consensus price target of $1.25, suggesting a potential downside of 65.75%. Laredo Petroleum has a consensus price target of $22.50, suggesting a potential downside of 34.04%. Given Laredo Petroleum's stronger consensus rating and higher possible upside, analysts plainly believe Laredo Petroleum is more favorable than Charah Solutions.
Valuation and Earnings
This table compares Charah Solutions and Laredo Petroleum's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Charah Solutions | $554.87 million | 0.20 | $-42,060,000.00 | ($0.94) | -3.88 |
| Laredo Petroleum | $837.28 million | 0.49 | $-342,460,000.00 | $14.80 | 2.30 |
Charah Solutions has higher earnings, but lower revenue than Laredo Petroleum. Charah Solutions is trading at a lower price-to-earnings ratio than Laredo Petroleum, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Charah Solutions and Laredo Petroleum's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Charah Solutions | -7.05% | -59.84% | -6.32% |
| Laredo Petroleum | -111.63% | 23.92% | 6.68% |
Risk & Volatility
Charah Solutions has a beta of 0.26, meaning that its stock price is 74% less volatile than the S&P 500. Comparatively, Laredo Petroleum has a beta of 4.72, meaning that its stock price is 372% more volatile than the S&P 500.
Insider and Institutional Ownership
33.0% of Charah Solutions shares are owned by institutional investors. Comparatively, 59.7% of Laredo Petroleum shares are owned by institutional investors. 3.7% of Charah Solutions shares are owned by insiders. Comparatively, 3.2% of Laredo Petroleum shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Summary
Laredo Petroleum beats Charah Solutions on 11 of the 14 factors compared between the two stocks.
