Black Stone Minerals (NYSE: BSM) and TransGlobe Energy (NASDAQ:TGA) are both energy companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, valuation, dividends, profitability and analyst recommendations.
Institutional and Insider Ownership
22.0% of Black Stone Minerals shares are owned by institutional investors. Comparatively, 22.4% of TransGlobe Energy shares are owned by institutional investors. 25.0% of Black Stone Minerals shares are owned by company insiders. Comparatively, 4.0% of TransGlobe Energy shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Black Stone Minerals pays an annual dividend of $1.25 per share and has a dividend yield of 6.6%. TransGlobe Energy does not pay a dividend. Black Stone Minerals pays out 192.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Black Stone Minerals has raised its dividend for 2 consecutive years.
This is a breakdown of recent recommendations and price targets for Black Stone Minerals and TransGlobe Energy, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Black Stone Minerals||0||1||3||0||2.75|
Black Stone Minerals presently has a consensus target price of $18.75, indicating a potential downside of 1.11%. Given Black Stone Minerals’ stronger consensus rating and higher possible upside, analysts plainly believe Black Stone Minerals is more favorable than TransGlobe Energy.
Earnings & Valuation
This table compares Black Stone Minerals and TransGlobe Energy’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Black Stone Minerals||$260.83 million||7.52||$20.20 million||$0.65||29.17|
|TransGlobe Energy||$122.36 million||0.87||-$87.66 million||($1.53)||-0.96|
Black Stone Minerals has higher revenue and earnings than TransGlobe Energy. TransGlobe Energy is trading at a lower price-to-earnings ratio than Black Stone Minerals, indicating that it is currently the more affordable of the two stocks.
This table compares Black Stone Minerals and TransGlobe Energy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Black Stone Minerals||21.57%||11.44%||6.99%|
Black Stone Minerals beats TransGlobe Energy on 14 of the 16 factors compared between the two stocks.
About Black Stone Minerals
Black Stone Minerals, L.P. is an owner of oil and natural gas mineral interests in the United States. The Company’s principal business is maximizing the value of its existing portfolio of mineral and royalty assets through active management and expanding its asset base through acquisitions of additional mineral and royalty interests. As of December 31, 2016, it owned mineral interests in approximately 15.5 million acres, with an average 45.7% ownership interest in that acreage. As of December 31, 2016, it also owned nonparticipating royalty interests in 1.5 million acres and overriding royalty interests in 1.5 million acres. As of December 31, 2016, these non-cost-bearing interests, which it referred to collectively as its mineral and royalty interests, included ownership in 50,000 producing wells. As of December 31, 2016, its mineral and royalty interests were located in 41 states and in 64 onshore basins in the continental United States.
About TransGlobe Energy
TransGlobe Energy Corporation is an oil exploration and production company. The Company’s activities are concentrated in the Arab Republic of Egypt (Egypt). The Company conducts its operations through the Arab Republic of Egypt segment. The Company is primarily engaged in oil exploration, development, production and the acquisition of properties. It holds interests in various production sharing concessions (PSC) in Eastern Desert Egypt and Western Desert Egypt. Its blocks in Eastern Desert Egypt include West Gharib, which covers approximately 34,860 acres; West Bakr, covering over 11,600 acres; North West (NW) Gharib, covering approximately 162,000 acres; South East (SE) Gharib, which covers over 125,650 acres, and South West (SW) Gharib, covering approximately 48,310 acres. Its blocks in the Western Desert Egypt include South Alamein, covering approximately 335,830 acres; South Ghazalat, covering over 465,300 acres, and North West (NW) Sitra, covering approximately 480,850 acres.
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