Financial Contrast: Chesapeake Granite Wash Trust (OTCMKTS:CHKR) versus Barnwell Industries (NYSE:BRN)

Chesapeake Granite Wash Trust (OTCMKTS:CHKR) and Barnwell Industries (NYSE:BRN) are both small-cap oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, risk, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and target prices for Chesapeake Granite Wash Trust and Barnwell Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chesapeake Granite Wash Trust	0	0	0	0	N/A
Barnwell Industries	0	0	0	0	N/A

Risk and Volatility

Chesapeake Granite Wash Trust has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500. Comparatively, Barnwell Industries has a beta of 0.19, indicating that its share price is 81% less volatile than the S&P 500.

Profitability

This table compares Chesapeake Granite Wash Trust and Barnwell Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chesapeake Granite Wash Trust	75.26%	77.49%	77.49%
Barnwell Industries	-11.35%	-14.70%	-7.70%

Insider and Institutional Ownership

40.7% of Barnwell Industries shares are held by institutional investors. 17.6% of Barnwell Industries shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Chesapeake Granite Wash Trust pays an annual dividend of $0.09 per share and has a dividend yield of 15.5%. Barnwell Industries pays an annual dividend of $0.03 per share and has a dividend yield of 1.0%. Chesapeake Granite Wash Trust pays out 50.0% of its earnings in the form of a dividend. Barnwell Industries pays out -11.1% 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.

Valuation and Earnings

This table compares Chesapeake Granite Wash Trust and Barnwell Industries’ revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chesapeake Granite Wash Trust	$10.69 million	2.54	$8.05 million	$0.18	3.22
Barnwell Industries	$25.27 million	1.17	-$960,000.00	($0.27)	-10.93

Chesapeake Granite Wash Trust has higher earnings, but lower revenue than Barnwell Industries. Barnwell Industries is trading at a lower price-to-earnings ratio than Chesapeake Granite Wash Trust, indicating that it is currently the more affordable of the two stocks.

Summary

Chesapeake Granite Wash Trust beats Barnwell Industries on 9 of the 13 factors compared between the two stocks.

About Chesapeake Granite Wash Trust

Chesapeake Granite Wash Trust owns royalty interests in oil, natural gas liquids, and natural gas properties located in the Colony Granite Wash play in Washita County in the Anadarko Basin of Western Oklahoma. It has royalty interests in 69 producing wells and 118 development wells, and in approximately 26,400 net acres of area. The company was incorporated in 2011 and is based in Houston, Texas.

About Barnwell Industries

Barnwell Industries, Inc. acquires, develops, produces, and sells oil and natural gas in Canada. The company operates through three segments: Oil and Natural Gas, Land Investment, and Contract Drilling. It also acquires and develops crude oil and natural gas assets in the province of Alberta, as well as invests in land interests in Hawaii. In addition, the company owns and operates threes water well drilling rigs, two pump rigs, and other ancillary drilling and pump equipment; and drills water and water monitoring wells of varying depths. Further, it installs and repairs water pumping systems; and distributes trillium flow technologies. Barnwell Industries, Inc. was incorporated in 1956 and is based in Honolulu, Hawaii.