Analyzing Statoil (STO) & Delek US (DK)

Statoil (NYSE: STO) and Delek US (NYSE:DK) are both oils/energy companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, risk, institutional ownership, profitability, valuation and earnings.

Volatility and Risk

Statoil has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, Delek US has a beta of 1.43, meaning that its share price is 43% more volatile than the S&P 500.

Valuation & Earnings

This table compares Statoil and Delek US’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Statoil $61.19 billion 1.48 $4.59 billion $1.38 19.80
Delek US $7.27 billion 0.57 $288.80 million $1.26 39.45

Statoil has higher revenue and earnings than Delek US. Statoil is trading at a lower price-to-earnings ratio than Delek US, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

5.0% of Statoil shares are owned by institutional investors. Comparatively, 91.7% of Delek US shares are owned by institutional investors. 1.4% of Delek US 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.

Dividends

Statoil pays an annual dividend of $0.32 per share and has a dividend yield of 1.2%. Delek US pays an annual dividend of $0.80 per share and has a dividend yield of 1.6%. Statoil pays out 23.2% of its earnings in the form of a dividend. Delek US pays out 63.5% 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.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Statoil and Delek US, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Statoil 3 11 2 0 1.94
Delek US 0 3 12 2 2.94

Statoil currently has a consensus price target of $21.50, indicating a potential downside of 21.30%. Delek US has a consensus price target of $43.21, indicating a potential downside of 13.07%. Given Delek US’s stronger consensus rating and higher possible upside, analysts clearly believe Delek US is more favorable than Statoil.

Profitability

This table compares Statoil and Delek US’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%
Delek US 2.89% 6.51% 2.13%

Statoil Company Profile

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.

Delek US Company Profile

Delek US Holdings, Inc. engages in the integrated downstream energy business in the United States. The company's Refining segment processes crude oil and other purchased feedstocks for the manufacture of various grades of gasoline, diesel fuel, aviation fuel, asphalt, and other petroleum-based products that are distributed through owned and third-party product terminals. This segment owns and operates four independent refineries located in Tyler, Texas; El Dorado, Arkansas; Big Spring, Texas; and Krotz Springs, Louisiana. This segment also owns and operates two biodiesel facilities in Crossett, Arkansas and Cleburne, Texas; and a heavy crude oil refinery in Bakersfield, California. Its Logistics segment gathers, transports, and stores crude oil, intermediate, and refined products; and markets, distributes, transports, and stores refined products for third parties. This segment owns or leases capacity on approximately 461 miles of crude oil transportation pipelines, approximately 406 miles of refined product pipelines, an approximately 600-mile crude oil gathering system, and associated crude oil storage tanks with an aggregate of approximately 7.3 million barrels of active shell capacity, as well as owns and operates nine light product terminals, and markets light products using third-party terminals. The company's Retail segment owns and leases 302 convenience store sites located primarily in Texas and New Mexico. This segment's convenience stores offer various grades of gasoline and diesel under the Alon brand name; and food products and service, tobacco products, beverages, and general merchandise, as well as money orders to the public under the 7-Eleven and Alon brand names. The company serves oil companies, independent refiners and marketers, jobbers, distributors, utility and transportation companies, independent retail fuel operators, and the United States government. Delek US Holdings, Inc. was founded in 2001 and is headquartered in Brentwood, Tennessee.

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