Analyzing Texas Pacific Land (NYSE:TPL) & Montauk Renewables (NASDAQ:MNTK)

Montauk Renewables (NASDAQ:MNTK) and Texas Pacific Land (NYSE:TPL) are both energy companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, risk, analyst recommendations, earnings, institutional ownership, valuation and dividends.

Volatility and Risk

Montauk Renewables has a beta of 0.05, indicating that its share price is 95% less volatile than the S&P 500. Comparatively, Texas Pacific Land has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Institutional & Insider Ownership

16.4% of Montauk Renewables shares are owned by institutional investors. Comparatively, 59.9% of Texas Pacific Land shares are owned by institutional investors. 54.7% of Montauk Renewables shares are owned by insiders. Comparatively, 6.9% of Texas Pacific Land shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Montauk Renewables and Texas Pacific Land”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Montauk Renewables	$176.38 million	0.94	$1.75 million	$0.02	58.25
Texas Pacific Land	$798.19 million	45.58	$481.38 million	$6.98	75.60

Texas Pacific Land has higher revenue and earnings than Montauk Renewables. Montauk Renewables is trading at a lower price-to-earnings ratio than Texas Pacific Land, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Montauk Renewables and Texas Pacific Land’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Montauk Renewables	0.15%	0.10%	0.07%
Texas Pacific Land	60.31%	36.18%	32.60%

Analyst Recommendations

This is a summary of current ratings and price targets for Montauk Renewables and Texas Pacific Land, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Montauk Renewables	1	3	0	0	1.75
Texas Pacific Land	1	2	1	0	2.00

Montauk Renewables currently has a consensus price target of $4.00, suggesting a potential upside of 243.35%. Texas Pacific Land has a consensus price target of $639.00, suggesting a potential upside of 21.09%. Given Montauk Renewables’ higher probable upside, equities analysts clearly believe Montauk Renewables is more favorable than Texas Pacific Land.

Summary

Texas Pacific Land beats Montauk Renewables on 12 of the 14 factors compared between the two stocks.

About Montauk Renewables

Montauk Renewables, Inc., a renewable energy company, engages in recovery and processing of biogas from landfills and other non-fossil fuel sources. It operates in two segments, Renewable Natural Gas and Renewable Electricity Generation. The company develops, owns, and operates renewable natural gas (RNG) projects that captures methane and prevents it from being released into the atmosphere by converting it into either RNG or electrical power for the electrical grid. Its customers for RNG and renewable identification numbers (RIN) include large, long-term owner-operators of landfills and livestock farms, local utilities, and large refiners in the natural gas and refining sectors. Montauk Renewables, Inc. was founded in 1980 and is headquartered in Pittsburgh, Pennsylvania.

About Texas Pacific Land

Texas Pacific Land Corporation engages in the land and resource management, and water services and operations businesses. The company owns a 1/128th nonparticipating perpetual oil and gas royalty interest (NPRI) under approximately 85,000 acres of land; a 1/16th NPRI under approximately 371,000 acres of land; and approximately 4,000 additional net royalty acres, total of approximately 195,000 NRA located in the western part of Texas. The Land and Resource Management segment manages surface acres of land, and oil and gas royalty interest in West Texas. This segment also engages in easements, such as transporting oil, gas and related hydrocarbons, power line and utility, and subsurface wellbore easements. In addition, this segment leases its land for processing, storage, and compression facilities and roads; and is involved in sale of materials, such as caliche, sand, and other material, as well as sells land. The Water Services and Operations segment provides full-service water offerings, including water sourcing, produced-water treatment, infrastructure development, and disposal solutions to operators in the Permian Basin. This segment also holds produced water royalties. Texas Pacific Land Corporation was founded in 1888 and is headquartered in Dallas, Texas.