Analyzing Scorpio Tankers (NYSE:STNG) and Devon Energy (NYSE:DVN)

Devon Energy (NYSE:DVN) and Scorpio Tankers (NYSE:STNG) are both energy companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Devon Energy and Scorpio Tankers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Devon Energy	0	3	25	2	2.97
Scorpio Tankers	1	5	5	0	2.36

Devon Energy currently has a consensus price target of $60.84, suggesting a potential upside of 23.49%. Scorpio Tankers has a consensus price target of $92.14, suggesting a potential upside of 11.14%. Given Devon Energy’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Devon Energy is more favorable than Scorpio Tankers.

Dividends

Devon Energy pays an annual dividend of $1.28 per share and has a dividend yield of 2.6%. Scorpio Tankers pays an annual dividend of $1.80 per share and has a dividend yield of 2.2%. Devon Energy pays out 30.4% of its earnings in the form of a dividend. Scorpio Tankers pays out 11.2% 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. Devon Energy has raised its dividend for 1 consecutive years and Scorpio Tankers has raised its dividend for 2 consecutive years.

Profitability

This table compares Devon Energy and Scorpio Tankers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Devon Energy	16.67%	14.93%	7.91%
Scorpio Tankers	67.16%	16.43%	13.14%

Valuation and Earnings

This table compares Devon Energy and Scorpio Tankers”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Devon Energy	$19.68 billion	2.75	$2.64 billion	$4.21	11.70
Scorpio Tankers	$1.22 billion	3.44	$344.29 million	$16.01	5.18

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

Insider & Institutional Ownership

69.7% of Devon Energy shares are held by institutional investors. Comparatively, 54.6% of Scorpio Tankers shares are held by institutional investors. 4.6% of Devon Energy shares are held by company insiders. Comparatively, 7.3% of Scorpio Tankers shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Risk & Volatility

Devon Energy has a beta of 0.49, indicating that its stock price is 51% less volatile than the S&P 500. Comparatively, Scorpio Tankers has a beta of -0.17, indicating that its stock price is 117% less volatile than the S&P 500.

Summary

Devon Energy beats Scorpio Tankers on 10 of the 18 factors compared between the two stocks.

About Devon Energy

Devon Energy Corporation, an independent energy company, engages in the exploration, development, and production of oil, natural gas, and natural gas liquids in the United States. It operates in Delaware, Eagle Ford, Anadarko, Williston, and Powder River Basins. The company was founded in 1971 and is headquartered in Oklahoma City, Oklahoma.

About Scorpio Tankers

Scorpio Tankers Inc., together with its subsidiaries, engages in the seaborne transportation of crude oi and refined petroleum products in the shipping markets worldwide. As of March 21, 2024, its fleet consisted of 110 owned and leases financed tanker, including 39 LR2, 57 MR, and 14 Handymax with a weighted average age of approximately 8.1 years. Scorpio Tankers Inc. was incorporated in 2009 and is headquartered in Monaco.