Permianville Royalty Trust (NYSE:PVL) and Apache (NYSE:APA) are both oils/energy companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, profitability, analyst recommendations, institutional ownership, risk, valuation and dividends.

Earnings and Valuation

This table compares Permianville Royalty Trust and Apache’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Permianville Royalty Trust $37.59 million 2.36 $44.74 million $1.36 1.98
Apache $6.42 billion 2.19 $1.30 billion $0.24 154.50

Apache has higher revenue and earnings than Permianville Royalty Trust. Permianville Royalty Trust is trading at a lower price-to-earnings ratio than Apache, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Permianville Royalty Trust has a beta of 0.62, indicating that its stock price is 38% less volatile than the S&P 500. Comparatively, Apache has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500.

Insider and Institutional Ownership

32.6% of Permianville Royalty Trust shares are held by institutional investors. Comparatively, 96.6% of Apache shares are held by institutional investors. 0.6% of Apache shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Permianville Royalty Trust and Apache’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Permianville Royalty Trust 98.57% 49.87% 49.87%
Apache 12.11% 7.71% 3.14%

Analyst Ratings

This is a summary of current recommendations and price targets for Permianville Royalty Trust and Apache, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Permianville Royalty Trust 0 0 0 0 N/A
Apache 4 11 5 0 2.05

Apache has a consensus price target of $47.22, indicating a potential upside of 27.35%. Given Apache’s higher possible upside, analysts plainly believe Apache is more favorable than Permianville Royalty Trust.

Dividends

Permianville Royalty Trust pays an annual dividend of $0.09 per share and has a dividend yield of 3.3%. Apache pays an annual dividend of $1.00 per share and has a dividend yield of 2.7%. Permianville Royalty Trust pays out 6.6% of its earnings in the form of a dividend. Apache pays out 416.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Permianville Royalty Trust is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Apache beats Permianville Royalty Trust on 8 of the 15 factors compared between the two stocks.

About Permianville Royalty Trust

Permianville Royalty Trust operates a statutory trust. It owns a net profits interest representing the right to receive an 80% of the net profits from the sale of oil and natural gas production from properties located in the states of Texas, Louisiana, and New Mexico held by Enduro Resource Partners LLC. The company was formerly known as Enduro Royalty Trust and changed its name to Permianville Royalty Trust in September 2018. Permianville Royalty Trust was founded in 2011 and is based in Houston, Texas.

About Apache

Apache Corporation, an independent energy company, explores for, develops, and produces natural gas, crude oil, and natural gas liquids (NGLs). The company has operations in onshore assets located Permian and Midcontinent/Gulf Coast onshore regions; and offshore assets situated in the Gulf of Mexico region. It also holds onshore assets in Egypt's Western desert; and offshore assets in the North Sea region, including the United Kingdom. As of December 31, 2017, the company had total estimated proved reserves of 1.2 billion barrel of oil equivalent, including 583 million barrels of crude oil, 204 million barrels of NGLs, and 2.3 trillion cubic feet of natural gas. Apache Corporation was founded in 1954 and is based in Houston, Texas.

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