Financial Analysis: Chevron (NYSE:CVX) and OMV (OTCMKTS:OMVKY)

OMV (OTCMKTS:OMVKY) and Chevron (NYSE:CVX) are both large-cap energy companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, dividends, valuation and profitability.

Dividends

OMV pays an annual dividend of $0.58 per share and has a dividend yield of 3.8%. Chevron pays an annual dividend of $6.84 per share and has a dividend yield of 3.8%. OMV pays out 13.7% of its earnings in the form of a dividend. Chevron pays out 102.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chevron has increased its dividend for 38 consecutive years. OMV is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares OMV and Chevron”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
OMV	$36.77 billion	0.54	$1.57 billion	$4.22	3.58
Chevron	$189.03 billion	1.91	$12.30 billion	$6.66	26.88

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

Insider and Institutional Ownership

72.4% of Chevron shares are held by institutional investors. 0.2% of Chevron shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for OMV and Chevron, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
OMV	4	3	1	0	1.63
Chevron	4	8	12	0	2.33

Chevron has a consensus target price of $175.00, suggesting a potential downside of 2.23%. Given Chevron’s stronger consensus rating and higher probable upside, analysts plainly believe Chevron is more favorable than OMV.

Risk & Volatility

OMV has a beta of 0.02, indicating that its share price is 98% less volatile than the S&P 500. Comparatively, Chevron has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.

Profitability

This table compares OMV and Chevron’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
OMV	4.57%	8.25%	4.12%
Chevron	6.51%	8.23%	4.87%

Summary

Chevron beats OMV on 14 of the 17 factors compared between the two stocks.

About OMV

OMV Aktiengesellschaft operates as an energy and chemicals company in Austria, Germany, Romania, Norway, Belgium, New Zealand, the United Arab Emirates, the rest of Central and Eastern Europe, the rest of Europe, and internationally. It operates through three segments: Chemicals & Materials, Fuels & Feedstock, and Energy. The company engages in the exploration, development, and production of oil and gas in the regions of Central and Eastern Europe, the Middle East and Africa, the North Sea, and the Asia Pacific; and refining and marketing of fuels and feedstock, as well as supply, marketing, trading, and logistics of gas in Romania and Turkey. In addition, the company provides advanced and circular polyolefin solutions, and base chemicals, as well as engages in the recycling of plastics. It has refineries in Europe, Schwechat, and Burghausen; filling stations in eight European countries; and gas storage facilities in Austria and Germany, as well as a gas-fired power plant in Romania. The company was founded in 1956 and is headquartered in Vienna, Austria.

About Chevron

Chevron Corporation, through its subsidiaries, engages in the integrated energy and chemicals operations in the United States and internationally. The company operates in two segments, Upstream and Downstream. The Upstream segment is involved in the exploration, development, production, and transportation of crude oil and natural gas; processing, liquefaction, transportation, and regasification of liquefied natural gas; transportation of crude oil through pipelines; transportation, storage, and marketing of natural gas; and carbon capture and storage, as well as a gas-to-liquids plant. The Downstream segment refines crude oil into petroleum products; markets crude oil, refined products, and lubricants; manufactures and markets renewable fuels, commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives; and transports crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car. The company was formerly known as ChevronTexaco Corporation and changed its name to Chevron Corporation in 2005. Chevron Corporation was founded in 1879 and is headquartered in San Ramon, California.