Laredo Petroleum (NYSE:LPI) and Devon Energy (NYSE:DVN) are both oils/energy companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, valuation, institutional ownership, dividends, analyst recommendations, risk and earnings.
Profitability
This table compares Laredo Petroleum and Devon Energy's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Laredo Petroleum | -111.63% | 23.92% | 6.68% |
| Devon Energy | -62.68% | 2.38% | 0.86% |
Insider & Institutional Ownership
59.7% of Laredo Petroleum shares are owned by institutional investors. Comparatively, 80.9% of Devon Energy shares are owned by institutional investors. 3.2% of Laredo Petroleum shares are owned by insiders. Comparatively, 0.6% of Devon Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares Laredo Petroleum and Devon Energy's revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Laredo Petroleum | $837.28 million | 0.49 | $-342,460,000.00 | $14.80 | 2.31 |
| Devon Energy | $6.22 billion | 2.77 | $-355,000,000.00 | $1.38 | 18.56 |
Laredo Petroleum has higher earnings, but lower revenue than Devon Energy. Laredo Petroleum is trading at a lower price-to-earnings ratio than Devon Energy, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Laredo Petroleum has a beta of 4.72, indicating that its stock price is 372% more volatile than the S&P 500. Comparatively, Devon Energy has a beta of 3.46, indicating that its stock price is 246% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of current ratings and target prices for Laredo Petroleum and Devon Energy, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Laredo Petroleum | 1 | 3 | 4 | 0 | 2.38 |
| Devon Energy | 0 | 2 | 17 | 1 | 2.95 |
Laredo Petroleum presently has a consensus target price of $22.50, suggesting a potential downside of 34.29%. Devon Energy has a consensus target price of $18.2143, suggesting a potential downside of 28.88%. Given Devon Energy's stronger consensus rating and higher probable upside, analysts clearly believe Devon Energy is more favorable than Laredo Petroleum.
Summary
Devon Energy beats Laredo Petroleum on 8 of the 15 factors compared between the two stocks.
