Matador Resources (NYSE: MTDR) and Pioneer Natural Resources (NYSE:PXD) are both mid-cap oil & gas exploration and production – nec companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, earnings and analyst recommendations.
Risk and Volatility
Matador Resources has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500. Comparatively, Pioneer Natural Resources has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500.
This table compares Matador Resources and Pioneer Natural Resources’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Pioneer Natural Resources||2.17%||2.34%||1.51%|
Institutional and Insider Ownership
83.6% of Matador Resources shares are owned by institutional investors. Comparatively, 91.4% of Pioneer Natural Resources shares are owned by institutional investors. 11.9% of Matador Resources shares are owned by insiders. Comparatively, 0.9% of Pioneer Natural Resources shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
This is a breakdown of current recommendations and price targets for Matador Resources and Pioneer Natural Resources, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Pioneer Natural Resources||0||4||21||0||2.84|
Matador Resources currently has a consensus price target of $29.33, suggesting a potential upside of 8.40%. Pioneer Natural Resources has a consensus price target of $194.69, suggesting a potential upside of 27.90%. Given Pioneer Natural Resources’ stronger consensus rating and higher possible upside, analysts plainly believe Pioneer Natural Resources is more favorable than Matador Resources.
Pioneer Natural Resources pays an annual dividend of $0.08 per share and has a dividend yield of 0.1%. Matador Resources does not pay a dividend. Pioneer Natural Resources pays out 11.0% of its earnings in the form of a dividend.
Valuation and Earnings
This table compares Matador Resources and Pioneer Natural Resources’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Matador Resources||$264.42 million||11.10||-$97.42 million||$1.97||13.74|
|Pioneer Natural Resources||$3.82 billion||6.77||-$556.00 million||$0.73||208.52|
Matador Resources has higher revenue, but lower earnings than Pioneer Natural Resources. Matador Resources is trading at a lower price-to-earnings ratio than Pioneer Natural Resources, indicating that it is currently the more affordable of the two stocks.
Matador Resources beats Pioneer Natural Resources on 9 of the 16 factors compared between the two stocks.
Matador Resources Company Profile
Matador Resources Company is an independent energy company engaged in the exploration, development, production and acquisition of oil and natural gas resources in the United States, with an emphasis on oil and natural gas shale and other unconventional plays. The Company’s segments include exploration and production, and midstream. The Company’s operations are focused primarily on the oil and liquids-rich portion of the Wolfcamp and Bone Spring plays in the Delaware Basin in Southeast New Mexico and West Texas. The Company also operates in the Eagle Ford shale play in South Texas and the Haynesville shale and Cotton Valley plays in Northwest Louisiana and East Texas. Additionally, the Company conducts midstream operations primarily, as of February 17, 2017, through its midstream joint venture, San Mateo Midstream, LLC (San Mateo or the Joint Venture).
Pioneer Natural Resources Company Profile
Pioneer Natural Resources Company is an oil and gas exploration and production company. The Company explores for, develops and produces oil, natural gas liquids (NGLs) and gas within the United States, with operations primarily in the Permian Basin in West Texas, the Eagle Ford Shale play in South Texas, the Raton field in southeast Colorado and the West Panhandle field in the Texas Panhandle. As of December 31, 2016, the Company owned interests in eight gas processing plants and nine treating facilities. As of December 31, 2016, its Spraberry/Wolfcamp field covered approximately 800,000 gross acres (690,000 net acres). The Company completed 12 Eagle Ford Shale wells during the fiscal year ended December 31, 2016. As of December 31, 2016, the Company owned approximately 185,000 gross acres (165,000 net acres) in the center of the Raton Basin. As of December 31, 2016, the Company’s gas had an average energy content of 1,400 British thermal unit (Btu).
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