TXO Partners (NYSE:TXO) and Chesapeake Granite Wash Trust (OTCMKTS:CHKR) Financial Analysis

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

Dividends

Chesapeake Granite Wash Trust pays an annual dividend of $0.09 per share and has a dividend yield of 15.3%. TXO Partners pays an annual dividend of $2.32 per share and has a dividend yield of 12.8%. Chesapeake Granite Wash Trust pays out 50.0% of its earnings in the form of a dividend. TXO Partners pays out -69.9% 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. TXO Partners has raised its dividend for 1 consecutive years.

Profitability

This table compares Chesapeake Granite Wash Trust and TXO Partners’ 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%
TXO Partners	-27.31%	6.89%	5.16%

Earnings & Valuation

This table compares Chesapeake Granite Wash Trust and TXO Partners’ revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chesapeake Granite Wash Trust	$10.69 million	2.57	$8.05 million	$0.18	3.27
TXO Partners	$380.72 million	1.47	-$103.99 million	($3.32)	-5.48

Chesapeake Granite Wash Trust has higher earnings, but lower revenue than TXO Partners. TXO Partners 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.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Chesapeake Granite Wash Trust and TXO Partners, 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
TXO Partners	0	0	1	1	3.50

TXO Partners has a consensus target price of $26.00, suggesting a potential upside of 42.94%. Given TXO Partners’ higher probable upside, analysts plainly believe TXO Partners is more favorable than Chesapeake Granite Wash Trust.

Volatility and Risk

Chesapeake Granite Wash Trust has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500. Comparatively, TXO Partners has a beta of -0.18, meaning that its stock price is 118% less volatile than the S&P 500.

Institutional & Insider Ownership

27.4% of TXO Partners shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Chesapeake Granite Wash Trust beats TXO Partners on 9 of the 16 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 TXO Partners

TXO Partners, L.P., an oil and natural gas company, focuses on the acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquid reserves in North America. Its acreage positions are concentrated in the Permian Basin of West Texas and New Mexico and the San Juan Basin of New Mexico and Colorado. The company was formerly known as TXO Energy Partners, L.P. and changed its name to TXO Partners, L.P. in May 2023. TXO Partners, L.P. was incorporated in 2012 and is based in Fort Worth, Texas.