SM Energy (NYSE:SM) versus China Coal Energy (OTCMKTS:CCOZY) Critical Survey

China Coal Energy (OTCMKTS:CCOZY) and SM Energy (NYSE:SM) are both 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.

Analyst Ratings

This is a summary of recent ratings and recommmendations for China Coal Energy and SM Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
China Coal Energy	0	1	0	0	2.00
SM Energy	0	6	10	2	2.78

SM Energy has a consensus price target of $39.76, suggesting a potential upside of 0.65%. Given SM Energy’s stronger consensus rating and higher probable upside, analysts clearly believe SM Energy is more favorable than China Coal Energy.

Valuation & Earnings

This table compares China Coal Energy and SM Energy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
China Coal Energy	$20.59 billion	0.93	$2.02 billion	$3.98	7.28
SM Energy	$3.15 billion	2.98	$648.00 million	$5.08	7.78

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

Volatility & Risk

China Coal Energy has a beta of -0.13, suggesting that its share price is 113% less volatile than the S&P 500. Comparatively, SM Energy has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500.

Insider & Institutional Ownership

94.6% of SM Energy shares are held by institutional investors. 0.5% of SM Energy 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.

Profitability

This table compares China Coal Energy and SM Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
China Coal Energy	N/A	N/A	N/A
SM Energy	18.20%	17.93%	7.70%

Dividends

China Coal Energy pays an annual dividend of $0.84 per share and has a dividend yield of 2.9%. SM Energy pays an annual dividend of $0.88 per share and has a dividend yield of 2.2%. China Coal Energy pays out 21.1% of its earnings in the form of a dividend. SM Energy pays out 17.3% 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. SM Energy has raised its dividend for 4 consecutive years.

Summary

SM Energy beats China Coal Energy on 15 of the 18 factors compared between the two stocks.

About China Coal Energy

China Coal Energy Company Limited primarily engages in the coal production and trading and coal chemical businesses in the People's Republic of China and internationally. The company offers polyolefin, methanol, urea, and other coal chemical products. It is also involved in the coal mining equipment manufacturing, pithead power generation, and other activities. The company was founded in 2006 and is based in Beijing, the People's Republic of China. China Coal Energy Company Limited operates as a subsidiary of China National Coal Group Co., Ltd.

About SM Energy

SM Energy Company, an independent energy company, engages in the acquisition, exploration, development, and production of oil, gas, and natural gas liquids in the state of Texas. It has working interests in oil and gas producing wells in the Midland Basin and South Texas. The company was formerly known as St. Mary Land & Exploration Company and changed its name to SM Energy Company in May 2010. SM Energy Company was founded in 1908 and is headquartered in Denver, Colorado.