Analyzing Talos Energy (TALO) and EOG Resources (NYSE:EOG)

Talos Energy (NYSE:TALO) and EOG Resources (NYSE:EOG) are both oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Valuation and Earnings

This table compares Talos Energy and EOG Resources’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Talos Energy $891.29 million 1.77 $221.54 million $2.66 10.96
EOG Resources $17.28 billion 3.05 $3.42 billion $5.54 16.41

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

Analyst Ratings

This is a summary of current recommendations and price targets for Talos Energy and EOG Resources, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Talos Energy 0 0 6 0 3.00
EOG Resources 0 7 20 0 2.74

Talos Energy currently has a consensus target price of $41.00, indicating a potential upside of 40.65%. EOG Resources has a consensus target price of $122.13, indicating a potential upside of 34.36%. Given Talos Energy’s stronger consensus rating and higher probable upside, research analysts clearly believe Talos Energy is more favorable than EOG Resources.

Dividends

EOG Resources pays an annual dividend of $0.88 per share and has a dividend yield of 1.0%. Talos Energy does not pay a dividend. EOG Resources pays out 15.9% of its earnings in the form of a dividend.

Volatility & Risk

Talos Energy has a beta of 1.66, indicating that its stock price is 66% more volatile than the S&P 500. Comparatively, EOG Resources has a beta of 1.24, indicating that its stock price is 24% more volatile than the S&P 500.

Profitability

This table compares Talos Energy and EOG Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Talos Energy 31.78% 5.25% 2.12%
EOG Resources 19.79% 17.83% 9.87%

Institutional & Insider Ownership

99.2% of Talos Energy shares are owned by institutional investors. Comparatively, 88.2% of EOG Resources shares are owned by institutional investors. 0.2% of Talos Energy shares are owned by insiders. Comparatively, 0.2% of EOG Resources shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

EOG Resources beats Talos Energy on 10 of the 16 factors compared between the two stocks.

Talos Energy Company Profile

Talos Energy Inc., an independent exploration and production company, focuses on the exploration and production in the United States Gulf of Mexico and offshore Mexico. The company was founded in 2011 and is headquartered in Houston, Texas.

EOG Resources Company Profile

EOG Resources, Inc., together with its subsidiaries, explores for, develops, produces, and markets crude oil and natural gas. The company's principal producing areas are located in New Mexico, North Dakota, Texas, Utah, and Wyoming in the United States; and the Republic of Trinidad and Tobago, the People's Republic of China, and Canada. As of December 31, 2018, it had total estimated net proved reserves of 2,928 million barrels of oil equivalent, including 1,532 million barrels (MMBbl) crude oil and condensate reserves; 614 MMBbl of natural gas liquid reserves; and 4,687 billion cubic feet of natural gas reserves. The company was formerly known as Enron Oil & Gas Company. EOG Resources, Inc. was founded in 1985 and is headquartered in Houston, Texas.

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