Concho Resources (CXO) & Range Resources-Louisiana (MRD) Critical Comparison

Concho Resources (NYSE: CXO) and Range Resources-Louisiana (NASDAQ:MRD) are both oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, profitability, risk, analyst recommendations and dividends.

Analyst Ratings

This is a breakdown of recent recommendations for Concho Resources and Range Resources-Louisiana, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Concho Resources 0 5 13 0 2.72
Range Resources-Louisiana 0 0 0 0 N/A

Concho Resources currently has a consensus price target of $152.41, indicating a potential upside of 11.74%. Given Concho Resources’ higher possible upside, equities research analysts clearly believe Concho Resources is more favorable than Range Resources-Louisiana.

Earnings & Valuation

This table compares Concho Resources and Range Resources-Louisiana’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Concho Resources $1.63 billion 12.41 -$1.46 billion $3.76 36.28
Range Resources-Louisiana N/A N/A N/A $0.23 64.00

Range Resources-Louisiana has lower revenue, but higher earnings than Concho Resources. Concho Resources is trading at a lower price-to-earnings ratio than Range Resources-Louisiana, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

94.6% of Concho Resources shares are held by institutional investors. Comparatively, 85.3% of Range Resources-Louisiana shares are held by institutional investors. 1.0% of Concho Resources shares are held by company insiders. Comparatively, 51.1% of Range Resources-Louisiana shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Concho Resources and Range Resources-Louisiana’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Concho Resources 24.19% 2.92% 1.87%
Range Resources-Louisiana -197.84% -39.17% -21.83%

Summary

Concho Resources beats Range Resources-Louisiana on 8 of the 9 factors compared between the two stocks.

About Concho Resources

Concho Resources Inc. is an independent oil and natural gas company engaged in the acquisition, development and exploration of oil and natural gas properties. The Company’s four operating areas include the Northern Delaware Basin, the Southern Delaware Basin, the Midland Basin and the New Mexico Shelf. As of December 31, 2016, the Company’s operations were focused in the Permian Basin, which underlies an area of Southeast New Mexico and West Texas approximately 250 miles wide and 300 miles long. The Permian Basin is an oil and natural gas producing region in the United States and is characterized by multiple producing horizons and enhanced recovery potential. As of December 31, 2016, the Company produced approximately 55.1 million barrels of oil equivalent (MMBoe) of oil and natural gas. As of December 31, 2016, all of its 720 MMBoe total estimated proved reserves were located in its core operating areas and consisted of approximately 59.5% oil and 40.5% natural gas.

About Range Resources-Louisiana

Range Resources-Louisiana, Inc., formerly Memorial Resource Development Corp, is an independent natural gas and oil company focused on the acquisition, exploration and development of natural gas and oil properties with substantially all of its activities in the Terryville Complex of North Louisiana. The Company’s segments include MRD and Memorial Production Partners LP (MEMP). The MRD Segment is focused on the acquisition, exploration, and development of natural gas and oil properties primarily in the Cotton Valley formation in North Louisiana. The MEMP Segment is engaged in the acquisition, exploitation, development and production of oil and natural gas properties, with assets consisting primarily of producing oil and natural gas properties that are located in Texas, Louisiana, Colorado, Wyoming and offshore Southern California. The MEMP segment reflects the combined operations of MEMP and its subsidiaries.

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