Financial Survey: Gran Tierra Energy (NYSE:GTE) versus Canadian Natural Resources (NYSE:CNQ)

Canadian Natural Resources (NYSE:CNQ) and Gran Tierra Energy (NYSE:GTE) are both energy companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, risk, analyst recommendations, dividends, institutional ownership and profitability.

Profitability

This table compares Canadian Natural Resources and Gran Tierra Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Canadian Natural Resources	22.78%	23.91%	11.45%
Gran Tierra Energy	7.17%	11.36%	3.28%

Risk and Volatility

Canadian Natural Resources has a beta of 0.47, meaning that its stock price is 53% less volatile than the S&P 500. Comparatively, Gran Tierra Energy has a beta of 0.19, meaning that its stock price is 81% less volatile than the S&P 500.

Valuation & Earnings

This table compares Canadian Natural Resources and Gran Tierra Energy”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Canadian Natural Resources	$31.61 billion	3.31	$7.74 billion	$4.05	12.54
Gran Tierra Energy	$638.42 million	0.61	-$6.29 million	($7.25)	-1.52

Canadian Natural Resources has higher revenue and earnings than Gran Tierra Energy. Gran Tierra Energy is trading at a lower price-to-earnings ratio than Canadian Natural Resources, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings for Canadian Natural Resources and Gran Tierra Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Canadian Natural Resources	0	5	7	0	2.58
Gran Tierra Energy	0	0	2	1	3.33

Canadian Natural Resources currently has a consensus target price of $57.00, indicating a potential upside of 12.21%. Gran Tierra Energy has a consensus target price of $9.72, indicating a potential downside of 11.67%. Given Canadian Natural Resources’ higher probable upside, analysts plainly believe Canadian Natural Resources is more favorable than Gran Tierra Energy.

Insider and Institutional Ownership

74.0% of Canadian Natural Resources shares are held by institutional investors. Comparatively, 31.7% of Gran Tierra Energy shares are held by institutional investors. 5.0% of Canadian Natural Resources shares are held by insiders. Comparatively, 5.8% of Gran Tierra Energy 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.

Summary

Canadian Natural Resources beats Gran Tierra Energy on 12 of the 15 factors compared between the two stocks.

About Canadian Natural Resources

Canadian Natural Resources Limited acquires, explores for, develops, produces, markets, and sells crude oil, natural gas, and natural gas liquids (NGLs). The company offers light and medium crude oil, primary heavy crude oil, Pelican Lake heavy crude oil, bitumen (thermal oil), and synthetic crude oil (SCO). The company’s midstream assets include two pipeline systems; and a 50% working interest in an 84-megawatt cogeneration plant at Primrose. It operates primarily in Western Canada; the United Kingdom portion of the North Sea; and Offshore Africa. The company was formerly known as AEX Minerals Corporation and changed its name to Canadian Natural Resources Limited in December 1975. Canadian Natural Resources Limited was incorporated in 1973 and is headquartered in Calgary, Canada.

About Gran Tierra Energy

Gran Tierra Energy Inc., together with its subsidiaries, engages in the exploration and production of oil and gas properties in Colombia and Ecuador. The company was founded in 2003 and is headquartered in Calgary, Canada.