Talos Energy (NYSE:TALO – Get Free Report) and Magnolia Oil & Gas (NYSE:MGY – Get Free Report) are both energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.
Profitability
This table compares Talos Energy and Magnolia Oil & Gas’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Talos Energy | -8.91% | -2.34% | -1.03% |
| Magnolia Oil & Gas | 27.57% | 19.34% | 13.47% |
Earnings & Valuation
This table compares Talos Energy and Magnolia Oil & Gas”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Talos Energy | $1.93 billion | 0.87 | -$76.39 million | ($0.97) | -9.93 |
| Magnolia Oil & Gas | $1.33 billion | 3.42 | $366.03 million | $1.91 | 12.46 |
Magnolia Oil & Gas has lower revenue, but higher earnings than Talos Energy. Talos Energy is trading at a lower price-to-earnings ratio than Magnolia Oil & Gas, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Talos Energy has a beta of 0.8, meaning that its share price is 20% less volatile than the S&P 500. Comparatively, Magnolia Oil & Gas has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Talos Energy and Magnolia Oil & Gas, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Talos Energy | 0 | 2 | 6 | 0 | 2.75 |
| Magnolia Oil & Gas | 2 | 8 | 4 | 0 | 2.14 |
Talos Energy currently has a consensus price target of $14.25, indicating a potential upside of 47.98%. Magnolia Oil & Gas has a consensus price target of $26.67, indicating a potential upside of 12.02%. Given Talos Energy’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Talos Energy is more favorable than Magnolia Oil & Gas.
Institutional and Insider Ownership
89.3% of Talos Energy shares are owned by institutional investors. Comparatively, 94.7% of Magnolia Oil & Gas shares are owned by institutional investors. 0.4% of Talos Energy shares are owned by insiders. Comparatively, 1.2% of Magnolia Oil & Gas shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Summary
Magnolia Oil & Gas beats Talos Energy on 10 of the 14 factors compared between the two stocks.
About Talos Energy
Talos Energy Inc., through its subsidiaries, engages in the exploration and production of oil, natural gas, and natural gas liquids in the United States and Mexico. It also engages in the development of carbon capture and sequestration. Talos Energy Inc. was founded in 2011 and is headquartered in Houston, Texas.
About Magnolia Oil & Gas
Magnolia Oil & Gas Corp. engages in the acquisition, development, exploration, and production of oil and natural gas properties. It operates assets located in the Eagle Ford Shale and Austin Chalk formations in South Texas. The company was founded on February 14, 2017 and is headquartered in Houston, TX.
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