Contrasting Ultrapar Participacoes (NYSE:UGP) & W&T Offshore (NYSE:WTI)

Ultrapar Participacoes (NYSE:UGP) and W&T Offshore (NYSE:WTI) are both energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, profitability, valuation, risk, dividends, analyst recommendations and institutional ownership.

Dividends

Ultrapar Participacoes pays an annual dividend of $0.31 per share and has a dividend yield of 5.7%. W&T Offshore pays an annual dividend of $0.04 per share and has a dividend yield of 1.3%. Ultrapar Participacoes pays out 50.8% 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.

Valuation & Earnings

This table compares Ultrapar Participacoes and W&T Offshore”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ultrapar Participacoes	$153.26 billion	0.04	$439.48 million	$0.61	8.91
W&T Offshore	$501.46 million	0.98	-$150.06 million	($0.34)	-9.31

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Ultrapar Participacoes	2.28%	18.84%	7.17%
W&T Offshore	-8.44%	N/A	-1.72%

Institutional & Insider Ownership

3.6% of Ultrapar Participacoes shares are owned by institutional investors. Comparatively, 42.9% of W&T Offshore shares are owned by institutional investors. 1.8% of Ultrapar Participacoes shares are owned by insiders. Comparatively, 35.9% of W&T Offshore shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Ultrapar Participacoes has a beta of 0.85, meaning that its share price is 15% less volatile than the S&P 500. Comparatively, W&T Offshore has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for Ultrapar Participacoes and W&T Offshore, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ultrapar Participacoes	0	5	3	1	2.56
W&T Offshore	1	0	1	1	2.67

Ultrapar Participacoes currently has a consensus price target of $6.54, indicating a potential upside of 20.33%. W&T Offshore has a consensus price target of $4.25, indicating a potential upside of 34.28%. Given W&T Offshore’s stronger consensus rating and higher probable upside, analysts plainly believe W&T Offshore is more favorable than Ultrapar Participacoes.

Summary

Ultrapar Participacoes beats W&T Offshore on 10 of the 16 factors compared between the two stocks.

About Ultrapar Participacoes

Ultrapar Participações S.A. is a Brazilian holding company with businesses focused on fuel distribution, liquefied petroleum gas (LPG) and bulk liquid storage. Its operations serve customers across Brazil, including consumers, businesses and industrial clients. The company’s main businesses include Ipiranga, which distributes and markets fuels and related products, and Ultragaz, a supplier of LPG for residential, commercial and industrial use. Through Ultracargo, Ultrapar also provides storage and handling services for bulk liquids, including fuels and chemicals.

About W&T Offshore

W&T Offshore, Inc. is an independent oil and natural gas company focused on exploring for, developing, acquiring and producing energy resources in the Gulf of Mexico. Its operations include offshore properties in both shallow-water and deepwater areas. The company’s production includes crude oil, natural gas and natural gas liquids. W&T Offshore holds interests in offshore leases and related infrastructure, supporting its exploration and production activities. Founded in 1983 by Tracy W. Krohn, the company is headquartered in Houston, Texas.