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Critical Analysis: Riley Exploration Permian (NYSE:REPX) Versus APA (NASDAQ:APA)

Defense World ·  Sep 21, 2022 01:31

Riley Exploration Permian (NYSE:REPX – Get Rating) and APA (NASDAQ:APA – Get Rating) are both oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.

Institutional and Insider Ownership

50.9% of Riley Exploration Permian shares are owned by institutional investors. Comparatively, 83.4% of APA shares are owned by institutional investors. 3.2% of Riley Exploration Permian shares are owned by insiders. Comparatively, 1.1% of APA shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

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Profitability

This table compares Riley Exploration Permian and APA's net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Riley Exploration Permian 26.17% 33.84% 18.96%
APA 32.57% 622.55% 17.83%

Dividends

Riley Exploration Permian pays an annual dividend of $1.24 per share and has a dividend yield of 5.7%. APA pays an annual dividend of $0.50 per share and has a dividend yield of 1.3%. Riley Exploration Permian pays out 35.6% of its earnings in the form of a dividend. APA pays out 5.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. APA has increased its dividend for 2 consecutive years.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Riley Exploration Permian and APA, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Riley Exploration Permian 0 0 1 0 3.00
APA 0 2 12 1 2.93

Riley Exploration Permian currently has a consensus price target of $52.00, indicating a potential upside of 137.33%. APA has a consensus price target of $52.94, indicating a potential upside of 33.68%. Given Riley Exploration Permian's stronger consensus rating and higher probable upside, analysts plainly believe Riley Exploration Permian is more favorable than APA.

Volatility & Risk

Riley Exploration Permian has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, APA has a beta of 3.81, meaning that its share price is 281% more volatile than the S&P 500.

Valuation and Earnings

This table compares Riley Exploration Permian and APA's revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Riley Exploration Permian $151.04 million 2.88 -$65.67 million $3.48 6.30
APA $7.99 billion 1.62 $973.00 million $8.89 4.45

APA has higher revenue and earnings than Riley Exploration Permian. APA is trading at a lower price-to-earnings ratio than Riley Exploration Permian, indicating that it is currently the more affordable of the two stocks.

Summary

APA beats Riley Exploration Permian on 11 of the 18 factors compared between the two stocks.

About Riley Exploration Permian

(Get Rating)

Riley Exploration Permian, Inc., an independent oil and natural gas company, engages in the acquisition, exploration, development, and production of oil, natural gas, and natural gas liquids in Texas and New Mexico. The company's activities are primarily focused on the San Andres Formation, a shelf margin deposit on the Central Basin Platform and Northwest Shelf. Its acreage is primarily located on contiguous blocks in Yoakum County, Texas; and Lea and Roosevelt Counties, New Mexico. As of September 30, 2021, the company had approximately 31,352 net acres and a total of 77 net producing wells. Riley Exploration Permian, Inc. is headquartered in Oklahoma City, Oklahoma.

About APA

(Get Rating)

APA Corporation, through its subsidiaries, explores for, develops, and produces oil and gas properties. It has operations in the United States, Egypt, and the United Kingdom, as well as has exploration activities offshore Suriname. The company also operates gathering, processing, and transmission assets in West Texas, as well as holds ownership in four Permian-to-Gulf Coast pipelines. APA Corporation was founded in 1954 and is based in Houston, Texas.

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