Analyzing Tellurian (NASDAQ:TELL) & Approach Resources (NASDAQ:AREXQ)

Approach Resources (OTCMKTS:AREXQ) and Tellurian (NASDAQ:TELL) are both small-cap oils/energy companies, but which is the better business? We will compare the two companies based on the strength of their dividends, institutional ownership, profitability, earnings, analyst recommendations, valuation and risk.

Valuation & Earnings

This table compares Approach Resources and Tellurian’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Approach Resources $114.04 million 0.02 -$19.91 million N/A N/A
Tellurian $28.77 million 9.08 -$151.77 million ($0.69) -1.17

Approach Resources has higher revenue and earnings than Tellurian.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Approach Resources and Tellurian, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Approach Resources 0 0 0 0 N/A
Tellurian 2 4 2 0 2.00

Tellurian has a consensus price target of $5.85, suggesting a potential upside of 622.22%. Given Tellurian’s higher probable upside, analysts clearly believe Tellurian is more favorable than Approach Resources.

Insider & Institutional Ownership

0.1% of Approach Resources shares are owned by institutional investors. Comparatively, 12.2% of Tellurian shares are owned by institutional investors. 2.1% of Approach Resources shares are owned by insiders. Comparatively, 27.0% of Tellurian shares are owned 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.

Risk and Volatility

Approach Resources has a beta of 2.39, suggesting that its stock price is 139% more volatile than the S&P 500. Comparatively, Tellurian has a beta of 2.49, suggesting that its stock price is 149% more volatile than the S&P 500.

Profitability

This table compares Approach Resources and Tellurian’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Approach Resources N/A N/A N/A
Tellurian -747.05% -106.47% -43.24%

About Approach Resources

Approach Resources, Inc., an independent energy company, focuses on the acquisition, exploration, development, and production of unconventional oil and gas reserves. The company's properties are primarily located in the Permian Basin in west Texas. It also owns interests in east Texas Basin. As of December 31, 2018, its estimated proved reserves were 180.1 million barrels of oil equivalent located in Crockett and Schleicher counties, Texas. The company also owned and operated 813 producing oil and gas wells in the Permian Basin. Approach Resources, Inc. was incorporated in 2002 and is headquartered in Fort Worth, Texas.

About Tellurian

Tellurian Inc. plans to develop, own, and operate a natural gas business and to deliver natural gas to customers worldwide. The company is developing a portfolio of natural gas production, liquefied natural gas (LNG) marketing, and infrastructure assets that includes an approximately 27.6 million tons per annum LNG export facility and an associated pipeline in southwest Louisiana. As of December 31, 2018, it owned interests in approximately 10,233 net acres of natural gas properties, and 52 producing wells located in the Haynesville Shale trend of north Louisiana. Tellurian Inc. has a strategic partnership with TOTAL S.A. to develop the Driftwood LNG project located in Louisiana. The company was founded in 2016 and is headquartered in Houston, Texas.

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