Statoil (STO) versus Equinor ASA (EQNR) Financial Review

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Statoil (NYSE:STO) and Equinor ASA (NYSE:EQNR) are both large-cap oils/energy companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, earnings, dividends, profitability, valuation and risk.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Statoil and Equinor ASA, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Statoil 2 7 2 0 2.00
Equinor ASA 0 5 2 0 2.29

Statoil currently has a consensus target price of $21.50, indicating a potential downside of 20.78%. Given Statoil’s higher possible upside, equities analysts clearly believe Statoil is more favorable than Equinor ASA.

Earnings & Valuation

This table compares Statoil and Equinor ASA’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Statoil $61.19 billion 1.47 $4.59 billion $1.38 19.67
Equinor ASA $61.19 billion 1.47 $4.59 billion $1.38 19.48

Equinor ASA is trading at a lower price-to-earnings ratio than Statoil, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

5.0% of Statoil shares are held by institutional investors. Comparatively, 5.2% of Equinor ASA shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Statoil pays an annual dividend of $0.32 per share and has a dividend yield of 1.2%. Equinor ASA pays an annual dividend of $0.67 per share and has a dividend yield of 2.5%. Statoil pays out 23.2% of its earnings in the form of a dividend. Equinor ASA pays out 48.6% 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. Statoil has increased its dividend for 5 consecutive years.

Profitability

This table compares Statoil and Equinor ASA’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Statoil 7.34% 12.32% 4.36%
Equinor ASA 6.69% 13.09% 4.68%

Risk and Volatility

Statoil has a beta of 0.93, indicating that its stock price is 7% less volatile than the S&P 500. Comparatively, Equinor ASA has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500.

Summary

Statoil beats Equinor ASA on 7 of the 12 factors compared between the two stocks.

About Statoil

Statoil ASA, an energy company, explores for, produces, transports, refines, and markets petroleum and petroleum-derived products, and other forms of energy in Norway and internationally. The company operates through Development & Production Norway; Development & Production USA; Development & Production International; Marketing, Midstream & Processing; New Energy Solutions; Technology, Projects & Drilling; Exploration; and Global Strategy & Business Development segments. It also transports, processes, manufactures, markets, and trades oil and gas commodities, such as crude, condensate, gas liquids, products, natural gas, and liquefied natural gas; markets and trades electricity and emission rights; and operates refineries, processing and power plants, and terminals. In addition, the company develops wind, and carbon capture and storage projects, as well as offers other renewable energy and low-carbon energy solutions. As of December 31, 2017, it had proved oil and gas reserves of 5,367 million barrels of oil equivalent. The company was formerly known as StatoilHydro ASA and changed its name to Statoil ASA in November 2009. Statoil ASA was founded in 1972 and is headquartered in Stavanger, Norway.

About Equinor ASA

Equinor ASA, an energy company, explores for, produces, transports, refines, and markets petroleum and petroleum-derived products, and other forms of energy in Norway and internationally. The company operates through Development & Production Norway; Development & Production USA; Development & Production International; Marketing, Midstream & Processing; New Energy Solutions; Technology, Projects & Drilling; Exploration; and Global Strategy & Business Development segments. It also transports, processes, manufactures, markets, and trades in oil and gas commodities, such as crude and condensate products, gas liquids, natural gas, and liquefied natural gas; markets and trades in electricity and emission rights; and operates refineries, processing and power plants, and terminals. In addition, the company develops wind, and carbon capture and storage projects, as well as offers other renewable energy and low-carbon energy solutions. As of December 31, 2017, it had proved oil and gas reserves of 5,367 million barrels of oil equivalent. The company was formerly known as Statoil ASA and changed its name to Equinor ASA in May 2018. Equinor ASA was founded in 1972 and is headquartered in Stavanger, Norway.

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