Comparing PDC Energy (NASDAQ:PDCE) & Marathon Oil (MRO)

PDC Energy (NASDAQ:PDCE) and Marathon Oil (NYSE:MRO) are both oils/energy companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, valuation, risk, profitability, analyst recommendations, earnings and institutional ownership.

Earnings and Valuation

This table compares PDC Energy and Marathon Oil’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
PDC Energy $1.55 billion 1.31 $2.02 million ($2.96) -10.31
Marathon Oil $6.58 billion 1.69 $1.10 billion $0.71 19.18

Marathon Oil has higher revenue and earnings than PDC Energy. PDC Energy is trading at a lower price-to-earnings ratio than Marathon Oil, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares PDC Energy and Marathon Oil’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PDC Energy -7.38% -2.50% -1.32%
Marathon Oil 15.12% 5.80% 3.26%

Risk and Volatility

PDC Energy has a beta of 0.78, suggesting that its stock price is 22% less volatile than the S&P 500. Comparatively, Marathon Oil has a beta of 2.23, suggesting that its stock price is 123% more volatile than the S&P 500.

Insider and Institutional Ownership

82.0% of Marathon Oil shares are owned by institutional investors. 1.0% of PDC Energy shares are owned by company insiders. Comparatively, 0.5% of Marathon Oil shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Marathon Oil pays an annual dividend of $0.20 per share and has a dividend yield of 1.5%. PDC Energy does not pay a dividend. Marathon Oil pays out 28.2% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for PDC Energy and Marathon Oil, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PDC Energy 1 6 16 0 2.65
Marathon Oil 0 3 16 0 2.84

PDC Energy currently has a consensus price target of $61.50, indicating a potential upside of 101.44%. Marathon Oil has a consensus price target of $23.52, indicating a potential upside of 72.71%. Given PDC Energy’s higher possible upside, equities research analysts plainly believe PDC Energy is more favorable than Marathon Oil.

Summary

Marathon Oil beats PDC Energy on 12 of the 15 factors compared between the two stocks.

About PDC Energy

PDC Energy, Inc., an independent exploration and production company, acquires, explores for, develops, and produces crude oil, natural gas, and natural gas liquids in the United States. Its operations are primarily located in the Wattenberg Field in Colorado and the Delaware Basin in Texas. The company was formerly known as Petroleum Development Corporation and changed its name to PDC Energy, Inc. in June 2012. PDC Energy, Inc. was founded in 1969 and is headquartered in Denver, Colorado.

About Marathon Oil

Marathon Oil Corporation operates as an energy company in the United States, Equatorial Guinea, the United Kingdom, and Libya. It operates in two segments, United States and International. The company engages in the exploration, production, and marketing of crude oil and condensate, natural gas liquids, and natural gas; and the production and marketing of products manufactured from natural gas, such as liquefied natural gas and methanol. As of December 31, 2018, it had estimated proved developed reserves totaling 752 million barrels of oil equivalent (mmboe); and estimated proved undeveloped reserves totaling 529 mmboe. The company was formerly known as USX Corporation and changed its name to Marathon Oil Corporation in July 2001. Marathon Oil Corporation was founded in 1887 and is headquartered in Houston, Texas.

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