Zion Oil & Gas (OTCMKTS:ZNOG – Get Free Report) and Diamondback Energy (NASDAQ:FANG – Get Free Report) are both energy companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, dividends, institutional ownership, risk, earnings, profitability and analyst recommendations.
Institutional & Insider Ownership
7.9% of Zion Oil & Gas shares are owned by institutional investors. Comparatively, 90.0% of Diamondback Energy shares are owned by institutional investors. 2.7% of Zion Oil & Gas shares are owned by insiders. Comparatively, 0.7% of Diamondback Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Valuation and Earnings
This table compares Zion Oil & Gas and Diamondback Energy”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Zion Oil & Gas | N/A | N/A | -$7.34 million | ($1.77) | -0.21 |
| Diamondback Energy | $11.07 billion | 3.90 | $3.34 billion | $14.39 | 10.48 |
Diamondback Energy has higher revenue and earnings than Zion Oil & Gas. Zion Oil & Gas is trading at a lower price-to-earnings ratio than Diamondback Energy, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of current recommendations for Zion Oil & Gas and Diamondback Energy, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Zion Oil & Gas | 0 | 0 | 0 | 0 | 0.00 |
| Diamondback Energy | 0 | 1 | 20 | 1 | 3.00 |
Diamondback Energy has a consensus price target of $188.67, suggesting a potential upside of 25.09%. Given Diamondback Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Diamondback Energy is more favorable than Zion Oil & Gas.
Volatility and Risk
Zion Oil & Gas has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500. Comparatively, Diamondback Energy has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.
Profitability
This table compares Zion Oil & Gas and Diamondback Energy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Zion Oil & Gas | N/A | -19.89% | -18.12% |
| Diamondback Energy | 27.32% | 9.57% | 5.70% |
Summary
Diamondback Energy beats Zion Oil & Gas on 13 of the 14 factors compared between the two stocks.
About Zion Oil & Gas
Zion Oil & Gas, Inc., together with its subsidiaries, operates as an oil and gas exploration company in Israel. It holds a petroleum exploration license onshore Israel, the New Megiddo License 434 comprising an area of approximately 75,000 acres. The company was incorporated in 2000 and is headquartered in Dallas, Texas.
About Diamondback Energy
Diamondback Energy, Inc., an independent oil and natural gas company, acquires, develops, explores, and exploits unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas. It focuses on the development of the Spraberry and Wolfcamp formations of the Midland basin; and the Wolfcamp and Bone Spring formations of the Delaware basin, which are part of the Permian Basin in West Texas and New Mexico. The company also owns and operates midstream infrastructure assets, in the Midland and Delaware Basins of the Permian Basin. Diamondback Energy, Inc. was founded in 2007 and is headquartered in Midland, Texas.
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