Critical Review: EOG Resources (NYSE:EOG) versus U.S. Energy (NASDAQ:USEG)

U.S. Energy (NASDAQ:USEG) and EOG Resources (NYSE:EOG) are both energy companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, valuation, earnings, analyst recommendations and risk.

Insider and Institutional Ownership

3.0% of U.S. Energy shares are owned by institutional investors. Comparatively, 89.9% of EOG Resources shares are owned by institutional investors. 61.0% of U.S. Energy shares are owned by company insiders. Comparatively, 0.1% of EOG Resources shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

U.S. Energy has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500. Comparatively, EOG Resources has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500.

Profitability

This table compares U.S. Energy and EOG Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
U.S. Energy	-195.49%	-51.91%	-29.64%
EOG Resources	22.00%	18.67%	11.25%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for U.S. Energy and EOG Resources, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
U.S. Energy	1	0	1	0	2.00
EOG Resources	0	18	11	1	2.43

U.S. Energy presently has a consensus target price of $3.50, indicating a potential upside of 309.84%. EOG Resources has a consensus target price of $145.04, indicating a potential upside of 1.70%. Given U.S. Energy’s higher possible upside, analysts clearly believe U.S. Energy is more favorable than EOG Resources.

Earnings and Valuation

This table compares U.S. Energy and EOG Resources”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
U.S. Energy	$7.35 million	5.14	-$14.37 million	($0.45)	-1.90
EOG Resources	$22.63 billion	3.38	$4.98 billion	$9.11	15.65

EOG Resources has higher revenue and earnings than U.S. Energy. U.S. Energy is trading at a lower price-to-earnings ratio than EOG Resources, indicating that it is currently the more affordable of the two stocks.

Summary

EOG Resources beats U.S. Energy on 11 of the 15 factors compared between the two stocks.

About U.S. Energy

U.S. Energy Corp., an independent energy company, focuses on the acquisition, exploration, and development of oil and natural gas properties in the United States. It holds interests in various oil and gas properties located in the Rockies region, including Montana, Wyoming, and North Dakota; the Mid-Continent region comprising Oklahoma, Kansas, and North and East Texas; West Texas; South Texas; and the Gulf Coast regions. The company was incorporated in 1966 and is headquartered in Houston, Texas.

About EOG Resources

EOG Resources, Inc., together with its subsidiaries, explores for, develops, produces, and markets crude oil, natural gas liquids, and natural gas primarily in producing basins in the United States, the Republic of Trinidad and Tobago and internationally. The company was formerly known as Enron Oil & Gas Company. EOG Resources, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.