Critical Analysis: Tullow Oil (OTCMKTS:TUWOY) & Kosmos Energy (NYSE:KOS)

Tullow Oil (OTCMKTS:TUWOY) and Kosmos Energy (NYSE:KOS) are both small-cap energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Tullow Oil and Kosmos Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tullow Oil	0	0	0	0	0.00
Kosmos Energy	1	4	1	0	2.00

Kosmos Energy has a consensus price target of $4.12, suggesting a potential upside of 168.40%. Given Kosmos Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Kosmos Energy is more favorable than Tullow Oil.

Risk & Volatility

Tullow Oil has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500. Comparatively, Kosmos Energy has a beta of 1.43, indicating that its share price is 43% more volatile than the S&P 500.

Profitability

This table compares Tullow Oil and Kosmos Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tullow Oil	N/A	N/A	N/A
Kosmos Energy	-10.74%	-14.16%	-3.00%

Institutional and Insider Ownership

95.3% of Kosmos Energy shares are owned by institutional investors. 2.0% of Kosmos Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Tullow Oil and Kosmos Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tullow Oil	$1.53 billion	0.17	$54.60 million	N/A	N/A
Kosmos Energy	$1.68 billion	0.44	$189.85 million	($0.33)	-4.65

Kosmos Energy has higher revenue and earnings than Tullow Oil.

Summary

Kosmos Energy beats Tullow Oil on 9 of the 12 factors compared between the two stocks.

About Tullow Oil

Tullow Oil plc engages in the oil and gas exploration, development, and production activities primarily in Africa, Europe, and South America. The company was founded in 1985 and is headquartered in London, the United Kingdom.

About Kosmos Energy

Kosmos Energy Ltd., together with its subsidiaries, engages in the exploration, development, and production of oil and gas along the Atlantic Margins in the United States. The company’s primary assets include production projects located in offshore Ghana, Equatorial Guinea, and the U.S. Gulf of Mexico, as well as gas projects located in offshore Mauritania and Senegal. It undertakes a proven basin exploration program in Equatorial Guinea and the U.S. Gulf of Mexico. Kosmos Energy Ltd. was founded in 2003 and is headquartered in Dallas, Texas.