RSP Permian (NYSE: RSPP) and Eca Marcellus Trust I (NYSE:ECT) are both oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, earnings, profitability, risk and valuation.
Risk and Volatility
RSP Permian has a beta of 1.97, indicating that its share price is 97% more volatile than the S&P 500. Comparatively, Eca Marcellus Trust I has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500.
Valuation & Earnings
This table compares RSP Permian and Eca Marcellus Trust I’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|RSP Permian||$353.86 million||15.77||-$24.85 million||$0.61||57.69|
|Eca Marcellus Trust I||$4.75 million||7.60||$3.47 million||$0.33||6.21|
Eca Marcellus Trust I has lower revenue, but higher earnings than RSP Permian. Eca Marcellus Trust I is trading at a lower price-to-earnings ratio than RSP Permian, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent recommendations for RSP Permian and Eca Marcellus Trust I, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Eca Marcellus Trust I||0||0||0||0||N/A|
RSP Permian currently has a consensus price target of $47.78, indicating a potential upside of 35.76%. Given RSP Permian’s higher possible upside, equities research analysts clearly believe RSP Permian is more favorable than Eca Marcellus Trust I.
Eca Marcellus Trust I pays an annual dividend of $0.29 per share and has a dividend yield of 14.1%. RSP Permian does not pay a dividend. Eca Marcellus Trust I pays out 87.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Institutional and Insider Ownership
87.0% of RSP Permian shares are held by institutional investors. Comparatively, 3.0% of Eca Marcellus Trust I shares are held by institutional investors. 15.0% of RSP Permian shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
This table compares RSP Permian and Eca Marcellus Trust I’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Eca Marcellus Trust I||84.37%||10.85%||10.57%|
RSP Permian beats Eca Marcellus Trust I on 11 of the 16 factors compared between the two stocks.
RSP Permian Company Profile
RSP Permian, Inc. is an independent oil and natural gas company. The Company is engaged in the acquisition, exploration, development and production of unconventional oil and associated liquids-rich natural gas reserves in the Permian Basin of West Texas. The Company’s properties are located on contiguous acreage blocks in the Midland Basin, and the Delaware Basin, both sub-basins of the Permian Basin. The Midland Basin properties are primarily in the adjacent counties of Midland, Martin, Andrews, Ector, Glasscock and Dawson. The Delaware Basin properties are in Loving and Winkler counties. The Company has drilled Lower Spraberry horizontal well and a Middle Spraberry horizontal well in the Permian Basin. In addition, it has also drilled a Wolfcamp B horizontal well in the North Midland Basin.
Eca Marcellus Trust I Company Profile
ECA Marcellus Trust I (the Trust) is a statutory trust. The Trust is formed by Energy Corporation of America (ECA) to own royalty interests in natural gas properties owned and operated by ECA in the Marcellus Shale formation in Greene County, Pennsylvania. The Trust does not conduct any operations or activities. The Trust’s purpose is, in general, to hold the Royalty Interests to distribute to the Trust unitholders cash and to perform certain administrative functions in respect of the Royalty Interests and the Trust units. The Trust owns royalty interests in over 10 Producing Wells (the Producing Wells), and royalty interests in over 50 horizontal natural gas development wells to be drilled to the Marcellus Shale formation (the PUD Wells) within the area of mutual interest (AMI), in which ECA holds approximately 9,300 acres, of which it owned all of the working interests, in Greene County, Pennsylvania. It owns Royalty Interests in over 40 development wells that are in production.
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