Encana Corporation (NYSE: ECA) and China Petroleum & Chemical Corporation (NYSE:SNP) are both mid-cap oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, profitabiliy, risk, dividends, institutional ownership and valuation.
Insider & Institutional Ownership
68.2% of Encana Corporation shares are owned by institutional investors. Comparatively, 0.7% of China Petroleum & Chemical Corporation shares are owned by institutional investors. 0.1% of Encana Corporation shares are owned by company insiders. Comparatively, 92.2% of China Petroleum & Chemical Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares Encana Corporation and China Petroleum & Chemical Corporation’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Encana Corporation||$3.52 billion||2.43||$980.00 million||($0.19)||-46.26|
|China Petroleum & Chemical Corporation||$306.12 billion||0.32||$28.52 billion||$6.94||11.69|
China Petroleum & Chemical Corporation has higher revenue and earnings than Encana Corporation. Encana Corporation is trading at a lower price-to-earnings ratio than China Petroleum & Chemical Corporation, indicating that it is currently the more affordable of the two stocks.
Encana Corporation pays an annual dividend of $0.06 per share and has a dividend yield of 0.7%. China Petroleum & Chemical Corporation pays an annual dividend of $1.05 per share and has a dividend yield of 1.3%. Encana Corporation pays out -31.6% of its earnings in the form of a dividend. China Petroleum & Chemical Corporation pays out 15.1% 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.
Volatility & Risk
Encana Corporation has a beta of 2.01, meaning that its stock price is 101% more volatile than the S&P 500. Comparatively, China Petroleum & Chemical Corporation has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500.
This is a breakdown of recent ratings for Encana Corporation and China Petroleum & Chemical Corporation, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|China Petroleum & Chemical Corporation||0||1||1||0||2.50|
Encana Corporation presently has a consensus target price of $13.62, indicating a potential upside of 54.93%. Given Encana Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe Encana Corporation is more favorable than China Petroleum & Chemical Corporation.
This table compares Encana Corporation and China Petroleum & Chemical Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|China Petroleum & Chemical Corporation||N/A||4.81%||2.73%|
Encana Corporation beats China Petroleum & Chemical Corporation on 10 of the 17 factors compared between the two stocks.
Encana Corporation Company Profile
Encana Corporation is an energy producer that is focused on developing its multi-basin portfolio of natural gas, oil and natural gas liquids (NGLs) producing plays. The Company’s operations also include the marketing of natural gas, oil and NGLs. All of its reserves and production are located in North America. It operates through three segments: Canadian Operations, USA Operations and Market optimization. Its Canadian Operations segment includes the exploration for, development of, and production of natural gas oil and NGLs and other related activities within Canada. Its Canadian operations include Montney in northeast British Columbia and northwest Alberta and Duvernay in west central Alberta. The USA Operations include the exploration for, development of, and production of natural gas, oil and NGLs, and other related activities within the United States. The Market Optimization activities are primarily responsible for the sale of the Company’s production to third party customers.
China Petroleum & Chemical Corporation Company Profile
China Petroleum & Chemical Corporation is a China-based energy and chemical company. The Company’s segments include Exploration and Development segment, Refining segment, Marketing and Distribution segment, Chemicals segment, and Corporate and Others segment. Exploration and Development segment explores and develops oil fields, as well as produces crude oil and natural gas. Refining segment processes and purifies crude oil, which is sourced from Exploration and Development segment and external suppliers. Marketing and Distribution segment owns and operates oil depots and service stations in China. Chemical segment manufactures and sells petrochemical products, derivative petrochemical products and other chemical products to external customers.
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