Financial Contrast: W&T Offshore (NYSE:WTI) versus Cheniere Energy (NYSE:LNG)

Cheniere Energy (NYSE:LNG – Get Free Report) and W&T Offshore (NYSE:WTI – Get Free Report) are both energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, profitability, valuation, analyst recommendations and institutional ownership.

Dividends

Cheniere Energy pays an annual dividend of $2.50 per share and has a dividend yield of 0.8%. W&T Offshore pays an annual dividend of $0.04 per share and has a dividend yield of 1.1%. Cheniere Energy pays out 17.4% of its earnings in the form of a dividend. W&T Offshore pays out -11.8% 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. W&T Offshore is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Cheniere Energy has a beta of 0.06, indicating that its stock price is 94% less volatile than the S&P 500. Comparatively, W&T Offshore has a beta of 0.3, indicating that its stock price is 70% less volatile than the S&P 500.

Institutional & Insider Ownership

87.3% of Cheniere Energy shares are owned by institutional investors. Comparatively, 42.9% of W&T Offshore shares are owned by institutional investors. 0.5% of Cheniere Energy shares are owned by company insiders. Comparatively, 35.9% of W&T Offshore shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Cheniere Energy and W&T Offshore’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cheniere Energy 13.57% 29.80% 7.05%
W&T Offshore -19.32% N/A -2.59%

Earnings & Valuation

This table compares Cheniere Energy and W&T Offshore”s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cheniere Energy $23.22 billion 2.77 $5.33 billion $14.33 21.75
W&T Offshore $601.43 million 0.91 -$150.06 million ($0.34) -10.40

Cheniere Energy has higher revenue and earnings than W&T Offshore. W&T Offshore is trading at a lower price-to-earnings ratio than Cheniere Energy, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Cheniere Energy and W&T Offshore, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cheniere Energy 0 3 16 1 2.90
W&T Offshore 1 1 1 0 2.00

Cheniere Energy currently has a consensus target price of $324.41, suggesting a potential upside of 4.08%. W&T Offshore has a consensus target price of $4.25, suggesting a potential upside of 20.23%. Given W&T Offshore’s higher possible upside, analysts clearly believe W&T Offshore is more favorable than Cheniere Energy.

Summary

Cheniere Energy beats W&T Offshore on 12 of the 17 factors compared between the two stocks.

About Cheniere Energy

(Get Free Report)

Cheniere Energy, Inc., an energy infrastructure company, primarily engages in the liquefied natural gas (LNG) related businesses in the United States. It owns and operates the Sabine Pass LNG terminal in Cameron Parish, Louisiana; and the Corpus Christi LNG terminal near Corpus Christi, Texas. The company also owns Creole Trail pipeline, a 94-mile natural gas supply pipeline that interconnects the Sabine Pass LNG Terminal with several interstate and intrastate pipelines; and operates Corpus Christi pipeline, a 21.5-mile natural gas supply pipeline that interconnects the Corpus Christi LNG terminal with various interstate and intrastate natural gas pipelines. It is also involved in the LNG and natural gas marketing business. The company was incorporated in 1983 and is headquartered in Houston, Texas.

About W&T Offshore

(Get Free Report)

W&T Offshore, Inc. engages in the production, exploration, development, and acquisition of oil and natural gas properties. It focuses its operations in the Gulf of Mexico. The company was founded by Tracy W. Krohn in 1983 and is headquartered in Houston, TX.

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