Cabot Oil & Gas (NYSE:COG) and Devon Energy (NYSE:DVN) are both oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, profitability, dividends, earnings, valuation and institutional ownership.
Risk & Volatility
Cabot Oil & Gas has a beta of 0.16, meaning that its stock price is 84% less volatile than the S&P 500. Comparatively, Devon Energy has a beta of 3.46, meaning that its stock price is 246% more volatile than the S&P 500.
Insider & Institutional Ownership
96.9% of Cabot Oil & Gas shares are held by institutional investors. Comparatively, 80.9% of Devon Energy shares are held by institutional investors. 2.1% of Cabot Oil & Gas shares are held by insiders. Comparatively, 0.6% of Devon Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Dividends
Cabot Oil & Gas pays an annual dividend of $0.40 per share and has a dividend yield of 2.1%. Devon Energy pays an annual dividend of $0.44 per share and has a dividend yield of 1.7%. Cabot Oil & Gas pays out 24.7% of its earnings in the form of a dividend. Devon Energy pays out 31.9% 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. Cabot Oil & Gas has increased its dividend for 1 consecutive years and Devon Energy has increased its dividend for 3 consecutive years. Cabot Oil & Gas is clearly the better dividend stock, given its higher yield and lower payout ratio.
Earnings & Valuation
This table compares Cabot Oil & Gas and Devon Energy's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Cabot Oil & Gas | $2.07 billion | 3.67 | $681.07 million | $1.62 | 11.71 |
Devon Energy | $6.22 billion | 2.77 | $-355,000,000.00 | $1.38 | 18.56 |
Cabot Oil & Gas has higher earnings, but lower revenue than Devon Energy. Cabot Oil & Gas is trading at a lower price-to-earnings ratio than Devon Energy, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings and target prices for Cabot Oil & Gas and Devon Energy, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Cabot Oil & Gas | 2 | 7 | 6 | 0 | 2.27 |
Devon Energy | 0 | 2 | 17 | 1 | 2.95 |
Cabot Oil & Gas presently has a consensus target price of $20.3667, indicating a potential upside of 7.36%. Devon Energy has a consensus target price of $18.2143, indicating a potential downside of 28.88%. Given Cabot Oil & Gas' higher possible upside, equities analysts plainly believe Cabot Oil & Gas is more favorable than Devon Energy.
Profitability
This table compares Cabot Oil & Gas and Devon Energy's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Cabot Oil & Gas | 16.73% | 8.84% | 4.24% |
Devon Energy | -62.68% | 2.38% | 0.86% |
Summary
Cabot Oil & Gas beats Devon Energy on 12 of the 18 factors compared between the two stocks.