Critical Comparison: Crescent Energy (NYSE:CRGY) and Diversified Energy (NYSE:DEC)

Crescent Energy (NYSE:CRGY) and Diversified Energy (NYSE:DEC) are both 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.

Dividends

Crescent Energy pays an annual dividend of $0.48 per share and has a dividend yield of 3.5%. Diversified Energy pays an annual dividend of $1.16 per share and has a dividend yield of 7.5%. Crescent Energy pays out -960.0% of its earnings in the form of a dividend. Diversified Energy pays out 35.9% 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. Crescent Energy has raised its dividend for 1 consecutive years.

Institutional & Insider Ownership

52.1% of Crescent Energy shares are owned by institutional investors. Comparatively, 26.5% of Diversified Energy shares are owned by institutional investors. 13.2% of Crescent Energy shares are owned by company insiders. Comparatively, 2.9% of Diversified Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk and Volatility

Crescent Energy has a beta of 1.45, suggesting that its share price is 45% more volatile than the S&P 500. Comparatively, Diversified Energy has a beta of -0.35, suggesting that its share price is 135% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Crescent Energy and Diversified Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Crescent Energy	1	5	9	1	2.62
Diversified Energy	0	3	7	0	2.70

Crescent Energy presently has a consensus price target of $15.92, indicating a potential upside of 15.51%. Diversified Energy has a consensus price target of $22.50, indicating a potential upside of 45.82%. Given Diversified Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Diversified Energy is more favorable than Crescent Energy.

Profitability

This table compares Crescent Energy and Diversified Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Crescent Energy	1.27%	10.52%	4.44%
Diversified Energy	N/A	N/A	N/A

Earnings and Valuation

This table compares Crescent Energy and Diversified Energy”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Crescent Energy	$4.31 billion	1.06	$132.91 million	($0.05)	-275.60
Diversified Energy	$1.94 billion	0.56	$341.11 million	$3.23	4.78

Diversified Energy has lower revenue, but higher earnings than Crescent Energy. Crescent Energy is trading at a lower price-to-earnings ratio than Diversified Energy, indicating that it is currently the more affordable of the two stocks.

Summary

Crescent Energy beats Diversified Energy on 12 of the 18 factors compared between the two stocks.

About Crescent Energy

Crescent Energy Company acquires, develops, and produces crude oil, natural gas, and natural gas liquids (NGLs) reserves. Its portfolio of assets comprises mid-cycle unconventional and conventional assets in the Eagle Ford and Uinta Basins. It also owns and operates various midstream assets, which provide services to customers. The company is based in Houston, Texas.

About Diversified Energy

Diversified Energy Company PLC operates as an independent owner and operator of producing natural gas and oil wells primarily in the Appalachian Basin of the United States. The company is involved in the production, marketing, and transportation of natural gas, natural gas liquids, crude oil, and condensates. Its assets consist of natural gas wells and gathering systems located in the states of Tennessee, Kentucky, Virginia, West Virginia, Ohio, Pennsylvania, Oklahoma, Texas, and Louisiana. The company was formerly known as Diversified Gas & Oil PLC and changed its name to Diversified Energy Company PLC in May 2021. Diversified Energy Company PLC was founded in 2001 and is headquartered in Birmingham, Alabama.