Analyzing APA (NASDAQ:APA) & Riley Exploration Permian (NYSE:REPX)

APA (NASDAQ:APAGet Rating) and Riley Exploration Permian (NYSE:REPXGet Rating) are both oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Profitability

This table compares APA and Riley Exploration Permian’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
APA 32.57% 622.55% 17.83%
Riley Exploration Permian 26.17% 33.84% 18.96%

Analyst Ratings

This is a breakdown of recent ratings and price targets for APA and Riley Exploration Permian, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
APA 0 2 12 1 2.93
Riley Exploration Permian 0 0 1 0 3.00

APA currently has a consensus target price of $52.94, indicating a potential upside of 33.68%. Riley Exploration Permian has a consensus target price of $52.00, indicating a potential upside of 137.33%. Given Riley Exploration Permian’s stronger consensus rating and higher probable upside, analysts clearly believe Riley Exploration Permian is more favorable than APA.

Dividends

APA pays an annual dividend of $0.50 per share and has a dividend yield of 1.3%. Riley Exploration Permian pays an annual dividend of $1.24 per share and has a dividend yield of 5.7%. APA pays out 5.6% of its earnings in the form of a dividend. Riley Exploration Permian pays out 35.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. APA has raised its dividend for 2 consecutive years.

Insider and Institutional Ownership

83.4% of APA shares are held by institutional investors. Comparatively, 50.9% of Riley Exploration Permian shares are held by institutional investors. 1.1% of APA shares are held by company insiders. Comparatively, 3.2% of Riley Exploration Permian shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares APA and Riley Exploration Permian’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
APA $7.99 billion 1.62 $973.00 million $8.89 4.45
Riley Exploration Permian $151.04 million 2.88 -$65.67 million $3.48 6.30

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

Volatility and Risk

APA has a beta of 3.81, meaning that its stock price is 281% more volatile than the S&P 500. Comparatively, Riley Exploration Permian has a beta of 0.96, meaning that its stock price is 4% less volatile than the S&P 500.

Summary

APA beats Riley Exploration Permian on 11 of the 18 factors compared between the two stocks.

About APA

(Get Rating)

APA Corporation, through its subsidiaries, explores for, develops, and produces oil and gas properties. It has operations in the United States, Egypt, and the United Kingdom, as well as has exploration activities offshore Suriname. The company also operates gathering, processing, and transmission assets in West Texas, as well as holds ownership in four Permian-to-Gulf Coast pipelines. APA Corporation was founded in 1954 and is based in Houston, Texas.

About Riley Exploration Permian

(Get Rating)

Riley Exploration Permian, Inc., an independent oil and natural gas company, engages in the acquisition, exploration, development, and production of oil, natural gas, and natural gas liquids in Texas and New Mexico. The company's activities are primarily focused on the San Andres Formation, a shelf margin deposit on the Central Basin Platform and Northwest Shelf. Its acreage is primarily located on contiguous blocks in Yoakum County, Texas; and Lea and Roosevelt Counties, New Mexico. As of September 30, 2021, the company had approximately 31,352 net acres and a total of 77 net producing wells. Riley Exploration Permian, Inc. is headquartered in Oklahoma City, Oklahoma.

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