RGC Resources (NASDAQ: RGCO) and Delta Natural Gas (NASDAQ:DGAS) are both small-cap oils/energy companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, analyst recommendations, risk and institutional ownership.
Earnings & Valuation
This table compares RGC Resources and Delta Natural Gas’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|RGC Resources||$62.30 million||3.25||$6.23 million||$0.83||30.60|
|Delta Natural Gas||N/A||N/A||N/A||$0.77||39.86|
Insider & Institutional Ownership
36.8% of Delta Natural Gas shares are held by institutional investors. 8.9% of RGC Resources shares are held by company insiders. Comparatively, 4.2% of Delta Natural Gas shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
This table compares RGC Resources and Delta Natural Gas’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Delta Natural Gas||-3.88%||-2.51%||-1.03%|
This is a summary of recent ratings and recommmendations for RGC Resources and Delta Natural Gas, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Delta Natural Gas||0||0||0||0||N/A|
RGC Resources currently has a consensus price target of $27.00, suggesting a potential upside of 6.30%. Given RGC Resources’ higher probable upside, analysts clearly believe RGC Resources is more favorable than Delta Natural Gas.
RGC Resources pays an annual dividend of $0.62 per share and has a dividend yield of 2.4%. Delta Natural Gas pays an annual dividend of $0.75 per share and has a dividend yield of 2.4%. RGC Resources pays out 74.7% of its earnings in the form of a dividend. Delta Natural Gas pays out 97.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
RGC Resources beats Delta Natural Gas on 9 of the 12 factors compared between the two stocks.
About RGC Resources
RGC Resources, Inc., through its subsidiaries, operates as an energy services company. The company sells and distributes natural gas to residential, commercial, and industrial customers in Roanoke, Virginia, and the surrounding localities. It also provides various unregulated services. The company operates approximately 1,135 miles of transmission and distribution pipeline; and a liquefied natural gas storage facility located in Botetourt County, as well as owns and operates 8 metering stations. RGC Resources, Inc. was founded in 1912 and is based in Roanoke, Virginia.
About Delta Natural Gas
Delta Natural Gas Company, Inc. distributes or transports natural gas to approximately 36,000 customers. The Company’s segments include regulated segment and non-regulated segment. Through regulated segment, the Company distributes natural gas to its retail customers in approximately 23 rural counties. Its three service areas are Nicholasville, Corbin and Berea, Kentucky. The non-regulated segment includes the Company’s three subsidiaries, Delta Resources, Inc. and Delgasco, Inc. (Delgasco), which purchase natural gas in the open market, including natural gas from Kentucky producers, and Enpro, Inc. (Enpro), which produces natural gas that is sold to Delgasco for resale in the open market. The Company owns approximately 2,600 miles of natural gas gathering, transmission, distribution and storage lines. These lines range in size over 12 inches in diameter. It also holds leases for the storage of natural gas under approximately 8,000 acres located in Bell County, Kentucky.
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