Financial Contrast: Neste OYJ (OTCMKTS:NTOIY) versus Arc Resources (OTCMKTS:AETUF)

Arc Resources (OTCMKTS:AETUF) and Neste OYJ (OTCMKTS:NTOIY) are both large-cap energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares Arc Resources and Neste OYJ’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arc Resources	19.75%	16.67%	9.09%
Neste OYJ	7.35%	19.90%	9.16%

Dividends

Arc Resources pays an annual dividend of $0.59 per share and has a dividend yield of 2.4%. Neste OYJ pays an annual dividend of $0.03 per share and has a dividend yield of 0.2%. Arc Resources pays out 33.0% of its earnings in the form of a dividend. Neste OYJ pays out 2.6% 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.

Analyst Ratings

This is a breakdown of current recommendations for Arc Resources and Neste OYJ, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arc Resources	1	10	3	0	2.14
Neste OYJ	0	2	1	4	3.29

Insider & Institutional Ownership

2.5% of Arc Resources shares are owned by institutional investors. 0.3% of Arc Resources shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Arc Resources and Neste OYJ”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arc Resources	$4.35 billion	3.20	$912.59 million	$1.79	13.71
Neste OYJ	$21.51 billion	1.43	$162.92 million	$1.15	17.37

Arc Resources has higher earnings, but lower revenue than Neste OYJ. Arc Resources is trading at a lower price-to-earnings ratio than Neste OYJ, indicating that it is currently the more affordable of the two stocks.

Summary

Arc Resources beats Neste OYJ on 8 of the 15 factors compared between the two stocks.

About Arc Resources

ARC Resources Ltd. engages in the acquiring and developing crude oil, natural gas, condensate, and natural gas liquids in Canada. It primarily holds interests in the Montney basin located in Alberta and northeast British Columbia. ARC Resources Ltd. was founded in 1996 and is based in Calgary, Canada.

About Neste OYJ

Neste Oyj provides renewable diesel and sustainable aviation fuel in Finland, and other Nordic countries, Baltic Rim, other European countries, North and South America, and internationally. The company operates in four segments: Renewable Products, Oil Products, Marketing & Services, and Others. The Renewable Products segment produces, markets, and sells renewable diesel, sustainable aviation fuel, renewable solvents, and feedstock for bioplastics to wholesale markets. The Oil Products segment produces, markets, and sells diesel, gasoline, aviation and marine fuels, light and heavy fuel oils, and gasoline components, as well as special fuels, such as small-engine gasoline, solvents, liquid gases, and bitumen. This segment serves retailers and distributors, oil majors and trading companies, petrochemicals companies, and companies marketing lubricants and solvents, as well as road transportation, non-road uses, aviation and marine sectors. The Marketing & Services segment markets and sells cleaner fuels and oil products, and associated services to private motorists, transport companies, customers in aviation, shipping, industrial and agricultural sectors, municipalities, farmers, and heating oil customers through a network of service stations, as well as direct sales and distributors. The Others segment offers engineering solutions. The company was formerly known as Neste Oil Oyj and changed its name to Neste Oyj in June 2015. Neste Oyj was founded in 1948 and is headquartered in Espoo, Finland.