Barnwell Industries (NYSE:BRN) versus Evolution Petroleum (NYSE:EPM) Critical Survey

Evolution Petroleum (NYSE:EPM) and Barnwell Industries (NYSE:BRN) are both small-cap energy companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Risk and Volatility

Evolution Petroleum has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500. Comparatively, Barnwell Industries has a beta of -0.31, meaning that its stock price is 131% less volatile than the S&P 500.

Profitability

This table compares Evolution Petroleum and Barnwell Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Evolution Petroleum	2.04%	2.42%	1.20%
Barnwell Industries	-34.01%	-48.90%	-22.57%

Valuation & Earnings

This table compares Evolution Petroleum and Barnwell Industries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Evolution Petroleum	$85.84 million	1.94	$4.08 million	$0.03	161.33
Barnwell Industries	$18.07 million	0.70	-$5.57 million	($0.65)	-1.92

Evolution Petroleum has higher revenue and earnings than Barnwell Industries. Barnwell Industries is trading at a lower price-to-earnings ratio than Evolution Petroleum, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and target prices for Evolution Petroleum and Barnwell Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Evolution Petroleum	0	1	2	0	2.67
Barnwell Industries	0	0	0	0	0.00

Evolution Petroleum presently has a consensus target price of $6.10, indicating a potential upside of 26.03%. Given Evolution Petroleum’s stronger consensus rating and higher probable upside, research analysts clearly believe Evolution Petroleum is more favorable than Barnwell Industries.

Insider & Institutional Ownership

60.1% of Evolution Petroleum shares are held by institutional investors. Comparatively, 40.7% of Barnwell Industries shares are held by institutional investors. 10.1% of Evolution Petroleum shares are held by insiders. Comparatively, 17.6% of Barnwell Industries shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Dividends

Evolution Petroleum pays an annual dividend of $0.48 per share and has a dividend yield of 9.9%. Barnwell Industries pays an annual dividend of $0.01 per share and has a dividend yield of 0.8%. Evolution Petroleum pays out 1,600.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Barnwell Industries pays out -1.5% of its earnings in the form of a dividend.

Summary

Evolution Petroleum beats Barnwell Industries on 14 of the 16 factors compared between the two stocks.

About Evolution Petroleum

Evolution Petroleum Corporation, an energy company, engages in the development, production, ownership, and exploitation of onshore oil and gas properties in the United States. The company holds a non-operated interests in the SCOOP and STACK plays located in Central Oklahoma; the Chaveroo Field situated in Chaves and Roosevelt Counties, New Mexico; the Jonah Field located in Sublette County, Wyoming; the Williston Basin situated in Williston, North Dakota; the Barnett Shale field located in North Texas; the Hamilton Dome situated in Hot Springs County, Wyoming; and the Delhi Field, an onshore CO2-EOR project located in northeast Louisiana in Franklin, Madison, and Richland Parishes, as well as small overriding royalty interests in four onshore central Texas wells. The company was founded in 2003 and is based in Houston, Texas.

About Barnwell Industries

Barnwell Industries, Inc. acquires, develops, produces, and sells oil and natural gas in Canada. The company operates through three segments: Oil and Natural Gas, Land Investment, and Contract Drilling. It also acquires and develops crude oil and natural gas assets in the province of Alberta, as well as invests in land interests in Hawaii. In addition, the company owns and operates threes water well drilling rigs, two pump rigs, and other ancillary drilling and pump equipment; and drills water and water monitoring wells of varying depths. Further, it installs and repairs water pumping systems; and distributes trillium flow technologies. Barnwell Industries, Inc. was incorporated in 1956 and is based in Honolulu, Hawaii.