Critical Analysis: Gran Tierra Energy (NYSE:GTE) vs. W&T Offshore (NYSE:WTI)

Gran Tierra Energy (NYSE:GTEGet Rating) and W&T Offshore (NYSE:WTIGet Rating) are both small-cap oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, valuation, profitability, dividends and earnings.

Profitability

This table compares Gran Tierra Energy and W&T Offshore’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gran Tierra Energy 17.01% 27.60% 6.14%
W&T Offshore -6.93% -18.05% 3.86%

Risk & Volatility

Gran Tierra Energy has a beta of 1.64, suggesting that its stock price is 64% more volatile than the S&P 500. Comparatively, W&T Offshore has a beta of 2.22, suggesting that its stock price is 122% more volatile than the S&P 500.

Institutional & Insider Ownership

22.0% of Gran Tierra Energy shares are owned by institutional investors. Comparatively, 36.9% of W&T Offshore shares are owned by institutional investors. 5.4% of Gran Tierra Energy shares are owned by company insiders. Comparatively, 34.4% of W&T Offshore shares are owned by company 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 & Earnings

This table compares Gran Tierra Energy and W&T Offshore’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Gran Tierra Energy $473.72 million 1.26 $42.48 million $0.26 6.23
W&T Offshore $558.01 million 1.45 -$41.48 million ($0.31) -18.23

Gran Tierra Energy has higher earnings, but lower revenue than W&T Offshore. W&T Offshore is trading at a lower price-to-earnings ratio than Gran Tierra Energy, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Gran Tierra Energy and W&T Offshore, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gran Tierra Energy 0 0 0 0 N/A
W&T Offshore 0 0 2 0 3.00

W&T Offshore has a consensus price target of $6.20, indicating a potential upside of 9.73%. Given W&T Offshore’s higher possible upside, analysts clearly believe W&T Offshore is more favorable than Gran Tierra Energy.

Summary

W&T Offshore beats Gran Tierra Energy on 7 of the 12 factors compared between the two stocks.

Gran Tierra Energy Company Profile (Get Rating)

Gran Tierra Energy Inc., together with its subsidiaries, engages in the exploration and production of oil and gas properties in Colombia and Ecuador. As of December 31, 2021, it had total proved undeveloped reserves of 24.8 million barrels of oil equivalent in Colombia. The company was incorporated in 2003 and is headquartered in Calgary, Canada.

W&T Offshore Company Profile (Get Rating)

W&T Offshore, Inc., an independent oil and natural gas producer, engages in the acquisition, exploration, and development of oil and natural gas properties in the Gulf of Mexico. The company sells crude oil, natural gas liquids, and natural gas. It holds working interest in approximately 41 offshore fields in federal and state waters. It has interests in offshore leases covering approximately 669,000 net acres spanning across the Outer Continental Shelf off the coasts of Louisiana, Texas, Mississippi, and Alabama. W&T Offshore, Inc. was founded in 1983 and is headquartered in Houston, Texas.

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