Critical Survey: ENI (NYSE:E) vs. APA (NASDAQ:APA)

ENI (NYSE:EGet Rating) and APA (NASDAQ:APAGet Rating) are both large-cap oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.

Dividends

ENI pays an annual dividend of $1.42 per share and has a dividend yield of 4.6%. APA pays an annual dividend of $0.50 per share and has a dividend yield of 1.1%. ENI pays out 36.2% of its earnings in the form of a dividend. APA pays out 19.3% 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. APA has raised its dividend for 1 consecutive years.

Volatility and Risk

ENI has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, APA has a beta of 4.43, meaning that its share price is 343% more volatile than the S&P 500.

Valuation and Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ENI $92.01 billion 0.60 $6.89 billion $3.92 7.84
APA $7.99 billion 1.93 $973.00 million $2.59 17.14

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

Insider & Institutional Ownership

1.2% of ENI shares are held by institutional investors. Comparatively, 86.6% of APA shares are held by institutional investors. 1.1% of APA shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares ENI and APA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ENI 7.81% 11.25% 3.66%
APA 12.44% -552.09% 10.91%

Analyst Ratings

This is a breakdown of current recommendations and price targets for ENI and APA, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ENI 1 4 11 0 2.63
APA 0 4 12 1 2.82

ENI currently has a consensus target price of $29.98, indicating a potential downside of 2.49%. APA has a consensus target price of $42.58, indicating a potential downside of 4.37%. Given ENI’s higher possible upside, research analysts clearly believe ENI is more favorable than APA.

Summary

APA beats ENI on 12 of the 18 factors compared between the two stocks.

ENI Company Profile (Get Rating)

Eni S.p.A. engages in the exploration, development, and production of crude oil and natural gas. It operates through Exploration & Production; Global Gas & LNG Portfolio; Refining & Marketing and Chemicals; Eni gas e luce, Power & Renewables; and Corporate and Other activities segments. The Exploration & Production segment is involved in the research, development, and production of oil, condensates and natural gas; and forestry conservation and CO2 capture and storage projects. The Global Gas & LNG Portfolio segment engages in the supply and wholesale of natural gas by pipeline, international transport; and purchase and marketing of LNG. The Refining & Marketing and Chemicals segment is involved in the processing, supply, distribution, and marketing of fuels and chemicals. The Eni gas e luce, Power & Renewables segment engages in the retail sales of gas, electricity, and related activities, as well as in the production and wholesale of electricity produced by thermoelectric and renewable plants. As of December 31, 2020, it had net proved reserves of 6,905 million barrels of oil equivalent; and installed operational capacity of 4.6 GW. The company was founded in 1953 and is headquartered in Rome, Italy.

APA Company Profile (Get Rating)

APA Corporation, through its subsidiaries, explores for, develops, and produces oil and gas properties. It has operations in the United States, Egypt, and the United Kingdom, as well as has exploration activities offshore Suriname. The company also operates gathering, processing, and transmission assets in West Texas, as well as holds ownership in four Permian-to-Gulf Coast pipelines. APA Corporation was founded in 1954 and is based in Houston, Texas.

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