Head-To-Head Analysis: VAALCO Energy (NYSE:EGY) & Ecopetrol (NYSE:EC)

Ecopetrol (NYSE:ECGet Rating) and VAALCO Energy (NYSE:EGYGet Rating) are both oils/energy companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, profitability and institutional ownership.

Insider & Institutional Ownership

1.2% of Ecopetrol shares are owned by institutional investors. Comparatively, 39.9% of VAALCO Energy shares are owned by institutional investors. 2.0% of VAALCO Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for Ecopetrol and VAALCO Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ecopetrol 1 2 0 0 1.67
VAALCO Energy 0 0 0 0 N/A

Ecopetrol currently has a consensus price target of $15.60, indicating a potential downside of 10.70%. Given Ecopetrol’s higher possible upside, equities analysts plainly believe Ecopetrol is more favorable than VAALCO Energy.

Risk & Volatility

Ecopetrol has a beta of 1.57, suggesting that its stock price is 57% more volatile than the S&P 500. Comparatively, VAALCO Energy has a beta of 1.77, suggesting that its stock price is 77% more volatile than the S&P 500.

Profitability

This table compares Ecopetrol and VAALCO Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ecopetrol 17.25% 49.32% 18.58%
VAALCO Energy 36.91% 42.80% 21.69%

Dividends

Ecopetrol pays an annual dividend of $1.46 per share and has a dividend yield of 8.4%. VAALCO Energy pays an annual dividend of $0.13 per share and has a dividend yield of 1.5%. Ecopetrol pays out 99.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. VAALCO Energy pays out 9.2% of its earnings in the form of a dividend.

Valuation & Earnings

This table compares Ecopetrol and VAALCO Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ecopetrol $119.45 billion N/A $20.34 billion $1.47 11.88
VAALCO Energy $199.07 million 2.52 $81.84 million $1.41 6.04

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

Summary

Ecopetrol beats VAALCO Energy on 7 of the 13 factors compared between the two stocks.

Ecopetrol Company Profile (Get Rating)

Ecopetrol S.A. operates as an integrated energy company. The company operates through four segments: Exploration and Production; Transport and Logistics; Refining, Petrochemical and Biofuels; and Electric Power Transmission and Toll Roads Concessions. It engages in the exploration and production of oil and gas; transportation of crude oil, motor fuels, fuel oil, and other refined products, including diesel, jet, and biofuels; processing and refining crude oil; distribution of natural gas and LPG; sale of refined and petrochemical products; supplying of electric power transmission services; design, development, construction, operation, and maintenance of road and energy infrastructure projects; and supplying of information technology and telecommunications services. As of December 31, 2021, the company had approximately 9,127 kilometers of crude oil and multi-purpose pipelines. It also produces and commercializes polypropylene resins and compounds, and masterbatches; and offers industrial service sales to customers and specialized management services. It has operations in Colombia, the United States, Asia, Central America and the Caribbean, Europe, South America, and internationally. The company was formerly known as Empresa Colombiana de Petróleos and changed its name to Ecopetrol S.A. in June 2003. Ecopetrol S.A. was incorporated in 1948 and is based in Bogotá, Colombia.

VAALCO Energy Company Profile (Get Rating)

VAALCO Energy, Inc., an independent energy company, acquires, explores for, develops, and produces crude oil and natural gas. The company holds Etame production sharing contract related to the Etame Marin block located offshore in the Republic of Gabon in West Africa. It also owns interests in an undeveloped block offshore Equatorial Guinea, West Africa. VAALCO Energy, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.

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