Midstates Petroleum (NYSE: NFX) and Newfield Exploration (NYSE:NFX) are both oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, dividends, valuation, profitability, institutional ownership, risk and analyst recommendations.

Profitability

This table compares Midstates Petroleum and Newfield Exploration’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Midstates Petroleum -59.15% 2.00% 1.51%
Newfield Exploration 17.53% 41.07% 11.85%

Earnings and Valuation

This table compares Midstates Petroleum and Newfield Exploration’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Midstates Petroleum $228.75 million 1.29 -$85.07 million N/A N/A
Newfield Exploration $1.77 billion 3.12 $427.00 million $2.15 12.82

Newfield Exploration has higher revenue and earnings than Midstates Petroleum.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Midstates Petroleum and Newfield Exploration, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Midstates Petroleum 0 1 0 0 2.00
Newfield Exploration 0 11 12 0 2.52

Newfield Exploration has a consensus target price of $37.68, indicating a potential upside of 36.74%. Given Newfield Exploration’s stronger consensus rating and higher probable upside, analysts plainly believe Newfield Exploration is more favorable than Midstates Petroleum.

Institutional & Insider Ownership

98.2% of Midstates Petroleum shares are owned by institutional investors. Comparatively, 99.4% of Newfield Exploration shares are owned by institutional investors. 1.8% of Midstates Petroleum shares are owned by company insiders. Comparatively, 0.6% of Newfield Exploration shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk & Volatility

Midstates Petroleum has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500. Comparatively, Newfield Exploration has a beta of 1.47, indicating that its stock price is 47% more volatile than the S&P 500.

Summary

Newfield Exploration beats Midstates Petroleum on 12 of the 13 factors compared between the two stocks.

About Midstates Petroleum

Midstates Petroleum Company, Inc. engages in the exploration, development, and production of oil, natural gas liquids, and natural gas in the United States. The company's operations are primarily focused on exploration and production activities in the Mississippian Lime and Anadarko Basin. As of December 31, 2017, its Mississippian Lime assets consisted of approximately 117,451 net acres in the Mississippian Lime trend in Woods and Alfalfa counties of Oklahoma; and Anadarko Basin assets consisted of approximately 76,409 net acres in Texas and 16,198 net acres in Western Oklahoma. The company was founded in 1993 and is headquartered in Tulsa, Oklahoma.

About Newfield Exploration

Newfield Exploration Company, an independent energy company, engages in the exploration, development, and production of crude oil, natural gas, and natural gas liquids in the United States. The company has operations principally in the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota, and the Uinta Basin of Utah. It also holds oil producing assets offshore China. The company was founded in 1988 and is headquartered in The Woodlands, Texas.

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