Contrasting CNOOC (CEO) & Ultra Petroleum (UPL)

CNOOC (NYSE:CEO) and Ultra Petroleum (NASDAQ:UPL) are both oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Analyst Ratings

This is a summary of recent ratings and target prices for CNOOC and Ultra Petroleum, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CNOOC 0 2 2 0 2.50
Ultra Petroleum 1 2 0 0 1.67

Ultra Petroleum has a consensus target price of $1.00, indicating a potential upside of 137.93%. Given Ultra Petroleum’s higher possible upside, analysts clearly believe Ultra Petroleum is more favorable than CNOOC.

Profitability

This table compares CNOOC and Ultra Petroleum’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CNOOC N/A N/A N/A
Ultra Petroleum 9.55% -13.76% 9.07%

Risk & Volatility

CNOOC has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500. Comparatively, Ultra Petroleum has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500.

Insider & Institutional Ownership

1.9% of CNOOC shares are held by institutional investors. Comparatively, 75.3% of Ultra Petroleum shares are held by institutional investors. 1.8% of Ultra Petroleum shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares CNOOC and Ultra Petroleum’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CNOOC $26.88 billion 2.93 $7.66 billion $17.06 10.33
Ultra Petroleum $892.50 million 0.09 $85.21 million $0.76 0.55

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

Dividends

CNOOC pays an annual dividend of $6.85 per share and has a dividend yield of 3.9%. Ultra Petroleum does not pay a dividend. CNOOC pays out 40.2% of its earnings in the form of a dividend. CNOOC has increased its dividend for 2 consecutive years.

Summary

CNOOC beats Ultra Petroleum on 11 of the 17 factors compared between the two stocks.

CNOOC Company Profile

CNOOC Limited, an investment holding company, explores for, develops, produces, and sells crude oil, natural gas, and other petroleum products. It operates through Exploration and Production, and Trading Business segments. The company produces offshore crude oil and natural gas primarily in Bohai, Western South China Sea, Eastern South China Sea, and East China Sea in offshore China. It also holds interests in various oil and gas assets in Asia, Africa, North America, South America, Oceania, and Europe. As of December 31, 2017, the company had net proved reserves of approximately 4.84 billion barrels-of-oil equivalent. In addition, it is involved in the issuance of bonds. The company was incorporated in 1999 and is based in Central, Hong Kong. CNOOC Limited is a subsidiary of China National Offshore Oil Corporation.

Ultra Petroleum Company Profile

Ultra Petroleum Corp., an independent oil and gas company, engages in the acquisition, exploration, development, operation, and production of oil and natural gas properties. Its principal business activities are developing its natural gas reserves in the Green River Basin of southwest Wyoming—the Pinedale and Jonah fields. As of December 31, 2018, the company owned interests in approximately 114,000 gross acres in Wyoming. The company was founded in 1979 and is headquartered in Englewood, Colorado.

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