Stone Energy Corporation (NYSE: SGY) and SilverBow Resources (NYSE:SBOW) are both small-cap 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.

Insider & Institutional Ownership

99.8% of Stone Energy Corporation shares are held by institutional investors. Comparatively, 31.0% of SilverBow Resources shares are held by institutional investors. 3.5% of Stone Energy Corporation 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 Stone Energy Corporation and SilverBow Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stone Energy Corporation 41.74% -215.45% 29.97%
SilverBow Resources 16.06% 24.48% 6.47%

Analyst Ratings

This is a breakdown of recent recommendations for Stone Energy Corporation and SilverBow Resources, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stone Energy Corporation 1 1 1 0 2.00
SilverBow Resources 0 1 1 0 2.50

Stone Energy Corporation currently has a consensus price target of $6.50, indicating a potential downside of 75.11%. SilverBow Resources has a consensus price target of $25.00, indicating a potential upside of 7.34%. Given SilverBow Resources’ stronger consensus rating and higher possible upside, analysts clearly believe SilverBow Resources is more favorable than Stone Energy Corporation.

Earnings & Valuation

This table compares Stone Energy Corporation and SilverBow Resources’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Stone Energy Corporation $364.82 million 1.43 $201.90 million N/A N/A
SilverBow Resources $179.00 million 1.50 $94.64 million N/A N/A

Stone Energy Corporation has higher revenue and earnings than SilverBow Resources.

Summary

Stone Energy Corporation beats SilverBow Resources on 6 of the 10 factors compared between the two stocks.

About Stone Energy Corporation

Stone Energy Corporation is an independent oil and natural gas company. The Company is engaged in the acquisition, exploration, exploitation, development and operation of oil and gas properties. The Company operates in the Gulf of Mexico (GOM) basin. It has leveraged its operations in the GOM conventional shelf and has its reserve base in the prolific basins of the GOM deep water, Gulf Coast deep gas, and the Marcellus and Utica shales in Appalachia. Its estimated proved oil and natural gas reserves are over 60 million barrels of oil equivalents (MMBoe) or 340 billion cubic feet equivalent (Bcfe). Over 95 MMBoe or 570 Bcfe of its estimated proved reserves are revised downward. It has made investments in seismic data and leasehold interests, and has geological, geophysical, engineering and operational operations in deep water arena to evaluate potential exploration, development and acquisition opportunities. It holds over two deep water platforms, producing reserves and various leases.

About SilverBow Resources

SilverBow Resources is a Houston-based energy company actively engaged in the exploration, development, and production of oil and gas from the Eagle Ford Shale in South Texas. With almost 30 years of history operating in South Texas, the Company possesses a significant understanding of regional reservoirs which they leverage to assemble drilling inventory.

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