Analyzing Extraction Oil & Gas (NASDAQ:XOG) & Antero Resources (NASDAQ:AR)

Extraction Oil & Gas (NASDAQ:XOG) and Antero Resources (NYSE:AR) are both small-cap oils/energy companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Extraction Oil & Gas and Antero Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Extraction Oil & Gas 1 8 5 0 2.29
Antero Resources 3 8 5 0 2.13

Extraction Oil & Gas currently has a consensus price target of $11.92, indicating a potential upside of 226.48%. Antero Resources has a consensus price target of $16.15, indicating a potential upside of 165.69%. Given Extraction Oil & Gas’ stronger consensus rating and higher possible upside, research analysts clearly believe Extraction Oil & Gas is more favorable than Antero Resources.

Risk and Volatility

Extraction Oil & Gas has a beta of 1.83, meaning that its share price is 83% more volatile than the S&P 500. Comparatively, Antero Resources has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500.

Profitability

This table compares Extraction Oil & Gas and Antero Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Extraction Oil & Gas 7.21% -2.57% -1.12%
Antero Resources -9.58% 3.70% 1.97%

Institutional and Insider Ownership

95.2% of Antero Resources shares are owned by institutional investors. 9.2% of Extraction Oil & Gas shares are owned by insiders. Comparatively, 9.4% of Antero Resources shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Extraction Oil & Gas and Antero Resources’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Extraction Oil & Gas $1.06 billion 0.56 $114.57 million ($0.10) -36.50
Antero Resources $4.14 billion 0.45 -$397.51 million $0.77 7.90

Extraction Oil & Gas has higher earnings, but lower revenue than Antero Resources. Extraction Oil & Gas is trading at a lower price-to-earnings ratio than Antero Resources, indicating that it is currently the more affordable of the two stocks.

Summary

Antero Resources beats Extraction Oil & Gas on 7 of the 13 factors compared between the two stocks.

About Extraction Oil & Gas

Extraction Oil & Gas, Inc., an independent oil and gas company, focuses on the acquisition, development, and production of oil, natural gas, and natural gas liquid reserves in the Rocky Mountain region, primarily in the Wattenberg Field of the Denver-Julesburg (DJ) Basin of Colorado. The company also engages in the construction and support of midstream assets to gather, process, and produce crude oil and gas. As of December 31, 2018, it had approximately 179,300 net acres of contiguous acreage blocks in the productive areas of the DJ Basin; held approximately 138,100 net acres outside of the Core DJ Basin; had estimated proved reserves of approximately 347.9MMBoe; and had 1,538 gross producing wells. The company was founded in 2012 and is headquartered in Denver, Colorado.

About Antero Resources

Antero Resources Corporation, an independent oil and natural gas company, acquires, explores for, develops, and produces natural gas, natural gas liquids, and oil properties in the United States. As of December 31, 2018, the company had approximately 486,000 net acres in the southwestern core of the Marcellus Shale; 125,000 net acres in the core of the Utica Shale; and 209,000 net acres of Marcellus Shale leasehold. It also owned and operated 289 miles of gas gathering pipelines in the Marcellus Shale; 17 compressor stations in the Marcellus Shale; 108 miles of low-pressure and high-pressure gathering pipelines in the Utica Shale; 8 miles of high-pressure pipelines; and 2 compressor station in the Utica Shale. The company had estimated proved reserves of 18.0 trillion cubic feet of natural gas equivalent, including 11.4 trillion cubic feet of natural gas; 554 million barrels of ethane; 498 million barrels of primarily propane, isobutane, normal butane, and natural gasoline; and 46 million barrels of oil. The company was formerly known as Antero Resources Appalachian Corporation and changed its name to Antero Resources Corporation in June 2013. Antero Resources Corporation was founded in 2002 and is headquartered in Denver, Colorado.

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