Critical Comparison: Oasis Petroleum (NASDAQ:OAS) and Falcon Minerals (NASDAQ:FLMN)

Oasis Petroleum (NASDAQ:OAS) and Falcon Minerals (NASDAQ:FLMN) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, analyst recommendations, dividends, valuation, profitability and institutional ownership.

Risk & Volatility

Oasis Petroleum has a beta of 3.83, meaning that its stock price is 283% more volatile than the S&P 500. Comparatively, Falcon Minerals has a beta of 1.48, meaning that its stock price is 48% more volatile than the S&P 500.

Insider & Institutional Ownership

49.7% of Oasis Petroleum shares are owned by institutional investors. Comparatively, 33.7% of Falcon Minerals shares are owned by institutional investors. 1.8% of Oasis Petroleum shares are owned by insiders. Comparatively, 15.8% of Falcon Minerals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Oasis Petroleum and Falcon Minerals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Oasis Petroleum -293.27% -0.64% -0.21%
Falcon Minerals 14.06% 2.82% 2.38%

Analyst Recommendations

This is a breakdown of current recommendations for Oasis Petroleum and Falcon Minerals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Oasis Petroleum 0 0 0 0 N/A
Falcon Minerals 0 4 2 0 2.33

Falcon Minerals has a consensus price target of $4.97, indicating a potential upside of 94.01%. Given Falcon Minerals’ higher probable upside, analysts plainly believe Falcon Minerals is more favorable than Oasis Petroleum.

Earnings & Valuation

This table compares Oasis Petroleum and Falcon Minerals’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Oasis Petroleum $2.07 billion 0.02 -$128.24 million $0.03 3.68
Falcon Minerals $68.46 million 3.22 $14.35 million $0.31 8.26

Falcon Minerals has lower revenue, but higher earnings than Oasis Petroleum. Oasis Petroleum is trading at a lower price-to-earnings ratio than Falcon Minerals, indicating that it is currently the more affordable of the two stocks.

Summary

Falcon Minerals beats Oasis Petroleum on 10 of the 13 factors compared between the two stocks.

About Oasis Petroleum

Oasis Petroleum Inc., an independent exploration and production company, focuses on the acquisition and development of onshore unconventional oil and natural gas resources in the North Dakota and Montana regions of the Williston Basin and the Texas region of the Delaware Basin. As of December 31, 2019, the company had 408,117 net leasehold acres in the Williston Basin; and 24,995 net leasehold acres in the Delaware Basin, as well as approximately 286.4 million barrels of oil equivalent of estimated net proved reserves. It also operates midstream services business. The company sells its crude oil and natural gas to refiners, marketers, and other purchasers that have access to pipeline and rail facilities. Oasis Petroleum Inc. was founded in 2007 and is headquartered in Houston, Texas.

About Falcon Minerals

Falcon Minerals Corporation acquires and owns mineral, royalty, and over-riding royalty interests in oil and natural gas properties in North America. It owns interests covering approximately 256,000 gross unit acres in the Eagle Ford Shale and Austin Chalk in Karnes, DeWitt, and Gonzales Counties in Texas, as well as approximately 75,000 gross unit acres in the Marcellus Shale across Pennsylvania, Ohio, and West Virginia. The company is based in New York, New York.

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