Analyzing EOG Resources (NYSE:EOG) & Golar LNG (NASDAQ:GLNG)

Golar LNG (NASDAQ:GLNG) and EOG Resources (NYSE:EOG) are both energy companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Valuation & Earnings

This table compares Golar LNG and EOG Resources”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golar LNG	$393.52 million	13.09	$65.68 million	$1.38	36.84
EOG Resources	$22.63 billion	3.32	$4.98 billion	$12.85	11.16

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

Volatility and Risk

Golar LNG has a beta of 0.05, indicating that its stock price is 95% less volatile than the S&P 500. Comparatively, EOG Resources has a beta of 0.25, indicating that its stock price is 75% less volatile than the S&P 500.

Profitability

This table compares Golar LNG and EOG Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golar LNG	30.10%	6.86%	3.00%
EOG Resources	25.44%	23.44%	13.58%

Analyst Ratings

This is a summary of current ratings and target prices for Golar LNG and EOG Resources, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golar LNG	0	3	4	1	2.75
EOG Resources	0	17	13	1	2.48

Golar LNG currently has a consensus price target of $58.70, indicating a potential upside of 15.46%. EOG Resources has a consensus price target of $156.32, indicating a potential upside of 9.02%. Given Golar LNG’s stronger consensus rating and higher possible upside, equities analysts clearly believe Golar LNG is more favorable than EOG Resources.

Dividends

Golar LNG pays an annual dividend of $1.00 per share and has a dividend yield of 2.0%. EOG Resources pays an annual dividend of $4.08 per share and has a dividend yield of 2.8%. Golar LNG pays out 72.5% of its earnings in the form of a dividend. EOG Resources pays out 31.8% 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. Golar LNG has increased its dividend for 2 consecutive years and EOG Resources has increased its dividend for 8 consecutive years. EOG Resources is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

92.2% of Golar LNG shares are held by institutional investors. Comparatively, 89.9% of EOG Resources shares are held by institutional investors. 0.0% of Golar LNG shares are held by company insiders. Comparatively, 0.1% of EOG Resources shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

EOG Resources beats Golar LNG on 11 of the 17 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 EOG Resources

EOG Resources, Inc., together with its subsidiaries, explores for, develops, produces, and markets crude oil, natural gas liquids, and natural gas primarily in producing basins in the United States, the Republic of Trinidad and Tobago and internationally. The company was formerly known as Enron Oil & Gas Company. EOG Resources, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.