Return Energy (CVE:RTN) and Canadian Natural Resources (TSE:CNQ) are both energy companies, but which is the better investment? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, analyst recommendations and earnings.
Valuation and Earnings
This table compares Return Energy and Canadian Natural Resources' gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Return Energy | C$1.54 million | 0.59 | C$-208,848.00 | C($0.01) | -4.38 |
| Canadian Natural Resources | C$19.00 billion | 2.60 | C$2.23 billion | C$1.88 | 22.18 |
Canadian Natural Resources has higher revenue and earnings than Return Energy. Return Energy is trading at a lower price-to-earnings ratio than Canadian Natural Resources, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Return Energy and Canadian Natural Resources' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Return Energy | N/A | N/A | N/A |
| Canadian Natural Resources | N/A | N/A | N/A |
Dividends
Return Energy pays an annual dividend of C$3.47 per share and has a dividend yield of 9,914.3%. Canadian Natural Resources pays an annual dividend of C$1.88 per share and has a dividend yield of 4.5%. Return Energy pays out -43,375.0% of its earnings in the form of a dividend. Canadian Natural Resources pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Return Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.
Analyst Recommendations
This is a breakdown of current ratings for Return Energy and Canadian Natural Resources, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Return Energy | 0 | 0 | 0 | 0 | N/A |
| Canadian Natural Resources | 0 | 3 | 10 | 0 | 2.77 |
Canadian Natural Resources has a consensus target price of C$40.80, suggesting a potential downside of 2.15%. Given Canadian Natural Resources' higher probable upside, analysts clearly believe Canadian Natural Resources is more favorable than Return Energy.
Summary
Canadian Natural Resources beats Return Energy on 7 of the 9 factors compared between the two stocks.
