Head-To-Head Survey: ConocoPhillips (COP) & BP (BP)

ConocoPhillips (NYSE:COP) and BP (NYSE:BP) are both large-cap oils/energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, institutional ownership, earnings and profitability.

Dividends

ConocoPhillips pays an annual dividend of $1.22 per share and has a dividend yield of 1.9%. BP pays an annual dividend of $2.44 per share and has a dividend yield of 6.1%. ConocoPhillips pays out 203.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BP pays out 129.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BP is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

ConocoPhillips has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500. Comparatively, BP has a beta of 0.85, meaning that its share price is 15% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and price targets for ConocoPhillips and BP, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ConocoPhillips 0 8 12 0 2.60
BP 0 2 9 2 3.00

ConocoPhillips currently has a consensus price target of $74.67, indicating a potential upside of 17.03%. BP has a consensus price target of $56.42, indicating a potential upside of 41.44%. Given BP’s stronger consensus rating and higher probable upside, analysts clearly believe BP is more favorable than ConocoPhillips.

Institutional and Insider Ownership

71.8% of ConocoPhillips shares are held by institutional investors. Comparatively, 11.0% of BP shares are held by institutional investors. 0.9% of ConocoPhillips shares are held by company insiders. Comparatively, 1.0% of BP shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares ConocoPhillips and BP’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ConocoPhillips 16.08% 14.62% 6.43%
BP 2.91% 11.14% 4.09%

Valuation and Earnings

This table compares ConocoPhillips and BP’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ConocoPhillips $32.58 billion 2.25 -$855.00 million $0.60 106.33
BP $244.58 billion 0.54 $3.39 billion $1.88 21.22

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

Summary

BP beats ConocoPhillips on 9 of the 17 factors compared between the two stocks.

ConocoPhillips Company Profile

ConocoPhillips explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas (LNG), and natural gas liquids worldwide. Its portfolio includes North American tight oil and oil sands assets in Canada; conventional assets in North America, Europe, Asia, and Australia; various LNG developments; and an inventory of conventional and unconventional exploration prospects. The company was founded in 1917 and is headquartered in Houston, Texas.

BP Company Profile

BP p.l.c. engages in energy business worldwide. It operates through three segments: Upstream, Downstream, and Rosneft. The Upstream segment is involved in the oil and natural gas exploration, field development, and production; midstream transportation, storage, and processing; and marketing and trading of liquefied natural gas (LNG), biogas, power and natural gas liquids (NGLs). This segment also engages in the ownership and management of crude oil and natural gas pipelines; processing facilities and export terminals; and LNG processing facilities and transportation, as well as in NGLs processing business. The Downstream segment refines, manufactures, markets, transports, supplies, and trades in crude oil, petroleum, and petrochemical products and related services to wholesale and retail customers. It offers gasoline, diesel, and aviation fuel; lubricants, and related products and services to the automotive, industrial, marine, and energy markets under the Castrol, BP, and Aral brands; and petrochemical products, such as purified terephthalic acid, paraxylene, acetic acid, olefins and derivatives, and specialty petrochemical products. The Rosneft segment engages in the exploration and production of hydrocarbons, as well as jet fuel, bunkering, bitumen, and lubricants activities. This segment also owns and operates 13 refineries in Russia; and approximately 2,960 retail service stations in Russia and internationally. The company also produces ethanol, bio-isobutanol, bio-power, and solar energy; transports hydrocarbon products through time-chartered and spot-chartered vessels; and holds interests in 14 onshore wind sites with a generation capacity of 1,432 megawatts through wind. BP p.l.c. was founded in 1889 and is headquartered in London, the United Kingdom.

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