Freehold Royalties (OTCMKTS:FRHLF – Get Free Report) and Kimbell Royalty (NYSE:KRP – Get Free Report) are both small-cap energy companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, dividends, analyst recommendations, valuation, profitability, risk and institutional ownership.
Analyst Recommendations
This is a summary of recent ratings and recommmendations for Freehold Royalties and Kimbell Royalty, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Freehold Royalties | 0 | 5 | 0 | 0 | 2.00 |
| Kimbell Royalty | 0 | 3 | 3 | 0 | 2.50 |
Kimbell Royalty has a consensus target price of $18.25, suggesting a potential upside of 26.87%. Given Kimbell Royalty’s stronger consensus rating and higher probable upside, analysts plainly believe Kimbell Royalty is more favorable than Freehold Royalties.
Dividends
Earnings and Valuation
This table compares Freehold Royalties and Kimbell Royalty”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Freehold Royalties | $224.34 million | 8.48 | $65.69 million | $0.61 | 19.02 |
| Kimbell Royalty | $344.86 million | 4.78 | $90.95 million | $0.84 | 17.12 |
Kimbell Royalty has higher revenue and earnings than Freehold Royalties. Kimbell Royalty is trading at a lower price-to-earnings ratio than Freehold Royalties, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
25.8% of Kimbell Royalty shares are owned by institutional investors. 5.6% of Kimbell Royalty shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Freehold Royalties and Kimbell Royalty’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Freehold Royalties | 43.59% | 13.90% | 10.09% |
| Kimbell Royalty | 27.17% | 14.95% | 7.41% |
Summary
Kimbell Royalty beats Freehold Royalties on 10 of the 15 factors compared between the two stocks.
About Freehold Royalties
Freehold Royalties Ltd. engages in the acquiring and managing royalty interests in the crude oil, natural gas, natural gas liquids, and potash properties in Western Canada and the United States. Freehold Royalties Ltd. was founded in 1996 and is headquartered in Calgary, Canada.
About Kimbell Royalty
Kimbell Royalty Partners, LP, together with its subsidiaries, engages in acquiring and owning mineral and royalty interests in oil and natural gas properties in the United States. It serves as the general partner of the company. The company was incorporated in 2015 and is based in Fort Worth, Texas.
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