Diamondback Energy (NASDAQ:FANG – Get Free Report) and PEDEVCO (NYSE:PED – Get Free Report) are both energy companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, profitability, valuation and risk.
Risk and Volatility
Diamondback Energy has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500. Comparatively, PEDEVCO has a beta of 0.29, meaning that its share price is 71% less volatile than the S&P 500.
Profitability
This table compares Diamondback Energy and PEDEVCO’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Diamondback Energy | 33.64% | 13.68% | 7.93% |
| PEDEVCO | 6.57% | 1.58% | 1.39% |
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Diamondback Energy | $11.02 billion | 3.54 | $3.14 billion | $15.80 | 8.54 |
| PEDEVCO | $39.55 million | 1.24 | $260,000.00 | $0.20 | 2.69 |
Diamondback Energy has higher revenue and earnings than PEDEVCO. PEDEVCO is trading at a lower price-to-earnings ratio than Diamondback Energy, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
90.0% of Diamondback Energy shares are owned by institutional investors. Comparatively, 3.3% of PEDEVCO shares are owned by institutional investors. 0.5% of Diamondback Energy shares are owned by insiders. Comparatively, 70.6% of PEDEVCO shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Recommendations
This is a breakdown of current ratings and target prices for Diamondback Energy and PEDEVCO, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Diamondback Energy | 0 | 2 | 19 | 2 | 3.00 |
| PEDEVCO | 0 | 0 | 2 | 0 | 3.00 |
Diamondback Energy currently has a consensus target price of $210.29, indicating a potential upside of 55.85%. PEDEVCO has a consensus target price of $1.63, indicating a potential upside of 202.49%. Given PEDEVCO’s higher probable upside, analysts plainly believe PEDEVCO is more favorable than Diamondback Energy.
Summary
Diamondback Energy beats PEDEVCO on 11 of the 14 factors compared between the two stocks.
About Diamondback Energy
Diamondback Energy, Inc., an independent oil and natural gas company, acquires, develops, explores, and exploits unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas. It focuses on the development of the Spraberry and Wolfcamp formations of the Midland basin; and the Wolfcamp and Bone Spring formations of the Delaware basin, which are part of the Permian Basin in West Texas and New Mexico. The company also owns and operates midstream infrastructure assets, in the Midland and Delaware Basins of the Permian Basin. Diamondback Energy, Inc. was founded in 2007 and is headquartered in Midland, Texas.
About PEDEVCO
PEDEVCO Corp., an oil and gas company, focuses on the acquisition, development, and production of oil and natural gas assets in the United States. It holds interests in the Permian Basin asset covering an area of approximately 22,721 net acres located in New Mexico; and D-J Basin asset covering an area of approximately 19,214 net acres located in Wyoming. The company is headquartered in Houston, Texas.
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