Statoil ASA (NYSE: STO) and Petroleo Brasileiro S.A.- Petrobras (NYSE:PBR) are both large-cap oils/energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Statoil ASA and Petroleo Brasileiro S.A.- Petrobras, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Statoil ASA 4 6 5 0 2.07
Petroleo Brasileiro S.A.- Petrobras 1 5 6 0 2.42

Statoil ASA currently has a consensus target price of $17.67, indicating a potential downside of 6.87%. Petroleo Brasileiro S.A.- Petrobras has a consensus target price of $10.81, indicating a potential upside of 16.34%. Given Petroleo Brasileiro S.A.- Petrobras’ stronger consensus rating and higher possible upside, analysts clearly believe Petroleo Brasileiro S.A.- Petrobras is more favorable than Statoil ASA.

Earnings and Valuation

This table compares Statoil ASA and Petroleo Brasileiro S.A.- Petrobras’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Statoil ASA $55.12 billion 1.11 $18.51 billion ($0.24) -79.04
Petroleo Brasileiro S.A.- Petrobras $82.85 billion 0.73 $32.86 billion ($0.47) -19.77

Petroleo Brasileiro S.A.- Petrobras has higher revenue and earnings than Statoil ASA. Statoil ASA is trading at a lower price-to-earnings ratio than Petroleo Brasileiro S.A.- Petrobras, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Statoil ASA and Petroleo Brasileiro S.A.- Petrobras’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Statoil ASA -1.32% 5.61% 1.93%
Petroleo Brasileiro S.A.- Petrobras -3.63% 5.00% 1.62%

Volatility & Risk

Statoil ASA has a beta of 0.97, indicating that its share price is 3% less volatile than the S&P 500. Comparatively, Petroleo Brasileiro S.A.- Petrobras has a beta of 2.43, indicating that its share price is 143% more volatile than the S&P 500.

Institutional and Insider Ownership

5.0% of Statoil ASA shares are held by institutional investors. Comparatively, 5.7% of Petroleo Brasileiro S.A.- Petrobras shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Statoil ASA pays an annual dividend of $0.70 per share and has a dividend yield of 3.7%. Petroleo Brasileiro S.A.- Petrobras does not pay a dividend. Statoil ASA pays out -291.7% of its earnings in the form of a dividend. Statoil ASA has raised its dividend for 4 consecutive years.

Summary

Statoil ASA beats Petroleo Brasileiro S.A.- Petrobras on 8 of the 15 factors compared between the two stocks.

About Statoil ASA

Statoil ASA (Statoil) is an energy company. The Company is engaged in oil and gas exploration and production activities. The Company’s segments include Development and Production Norway (DPN), Development and Production International (DPI), Marketing, Midstream and Processing (MMP) and Other. DPN segment manages the Company’s upstream activities on the Norwegian continental shelf (NCS) and explores for and extracts crude oil, natural gas and natural gas liquids. DPI segment manages the Company’s upstream activities that are not included in the DPN and Development and Production USA (DPUSA) business areas. MMP segment manages its marketing and trading activities related to oil products and natural gas, transportation, processing and manufacturing, and the development of oil and gas. Other segment includes activities in New Energy Solutions (NES), Technology, Projects and Drilling (TPD), Global Strategy and Business Development (GSB), and Corporate staffs and support functions.

About Petroleo Brasileiro S.A.- Petrobras

Petroleo Brasileiro S.A.-Petrobras specializes in the oil, natural gas and energy industry. The Company is engaged in prospecting, drilling, refining, processing, trading and transporting crude oil from producing onshore and offshore oil fields and from shale or other rocks. Its segments include Exploration and Production, which covers the activities of exploration, development and production of crude oil, natural gas liquid and natural gas; Refining, Transportation and Marketing, which covers the refining, logistics, transport and trading of crude oil and oil products activities, exporting of ethanol, and extraction and processing of shale; Gas and Power, which is engaged in transportation and trading of natural gas produced in Brazil and imported natural gas; Biofuels, which covers the activities of production of biodiesel and its co-products, and ethanol-related activities; Distribution, which includes the activities of its subsidiary Petrobras Distribuidora S.A., and Corporate.

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