Head to Head Survey: Ecopetrol (NYSE:EC) vs. Golar LNG (NASDAQ:GLNG)

Golar LNG (NASDAQ:GLNG) and Ecopetrol (NYSE:EC) are both energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, dividends, earnings, analyst recommendations, profitability, institutional ownership and risk.

Insider and Institutional Ownership

92.2% of Golar LNG shares are held by institutional investors. 0.0% of Golar LNG shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Golar LNG has a beta of 0.18, indicating that its share price is 82% less volatile than the S&P 500. Comparatively, Ecopetrol has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.

Earnings & Valuation

This table compares Golar LNG and Ecopetrol”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golar LNG	$260.37 million	14.88	$50.84 million	$0.57	65.04
Ecopetrol	$32.80 billion	0.58	$15.23 billion	$1.31	7.05

Ecopetrol has higher revenue and earnings than Golar LNG. Ecopetrol is trading at a lower price-to-earnings ratio than Golar LNG, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and price targets for Golar LNG and Ecopetrol, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golar LNG	1	2	4	3	2.90
Ecopetrol	1	3	1	0	2.00

Golar LNG presently has a consensus target price of $50.42, suggesting a potential upside of 36.00%. Ecopetrol has a consensus target price of $10.73, suggesting a potential upside of 16.22%. Given Golar LNG’s stronger consensus rating and higher probable upside, research analysts clearly believe Golar LNG is more favorable than Ecopetrol.

Dividends

Golar LNG pays an annual dividend of $1.00 per share and has a dividend yield of 2.7%. Ecopetrol pays an annual dividend of $1.51 per share and has a dividend yield of 16.4%. Golar LNG pays out 175.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ecopetrol pays out 115.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Golar LNG has increased its dividend for 2 consecutive years. Ecopetrol is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Golar LNG and Ecopetrol’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golar LNG	17.96%	6.07%	3.12%
Ecopetrol	8.75%	5.15%	1.82%

Summary

Golar LNG beats Ecopetrol on 12 of the 18 factors compared between the two stocks.

About Golar LNG

Golar LNG Limited designs, converts, owns, and operates marine infrastructure for the liquefaction of natural gas. The company operates through three segments: FLNG, Corporate and Other, and Shipping. It engages in the regasification, storage, and offloading of liquefied natural gas (LNG); operation of floating liquefaction natural gas (FLNG) vessels or projects; transportation of LNG carriers; and vessel management activities. Golar LNG Limited was founded in 1946 and is headquartered in Hamilton, Bermuda.

About Ecopetrol

Ecopetrol S.A. operates as an integrated energy company. The company operates through four segments: Exploration and Production; Transport and Logistics; Refining, Petrochemical and Biofuels; and Electric Power Transmission and Toll Roads Concessions. It engages in the exploration and production of oil and gas; transportation of crude oil, motor fuels, fuel oil, and other refined products, including diesel, jet, and biofuels; processing and refining crude oil; distribution of natural gas and LPG; sale of refined and petrochemical products; supplying of electric power transmission services; design, development, construction, operation, and maintenance of road and energy infrastructure projects; and supplying of information technology and telecommunications services. As of December 31, 2022, the company had approximately 9,127 kilometers of crude oil and multi-purpose pipelines. It also produces and commercializes polypropylene resins and compounds, and masterbatches; and offers industrial service sales to customers and specialized management services. It has operations in Colombia, the United States, Asia, Central America and the Caribbean, Europe, and South America. The company was formerly known as Empresa Colombiana de Petróleos and changed its name to Ecopetrol S.A. in June 2003. Ecopetrol S.A. was incorporated in 1948 and is headquartered in Bogotá, Colombia.