Critical Contrast: Gevo (NASDAQ:GEVO) vs. Expand Energy (NASDAQ:EXE)

Expand Energy (NASDAQ:EXE) and Gevo (NASDAQ:GEVO) are both energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.

Valuation & Earnings

This table compares Expand Energy and Gevo”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Expand Energy	$12.12 billion	1.93	$1.82 billion	$13.41	7.28
Gevo	$160.58 million	2.58	-$33.84 million	($0.13)	-13.08

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

Profitability

This table compares Expand Energy and Gevo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Expand Energy	22.53%	10.26%	6.73%
Gevo	-19.38%	-5.06%	-3.41%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Expand Energy and Gevo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Expand Energy	0	5	12	2	2.84
Gevo	2	1	2	0	2.00

Expand Energy currently has a consensus target price of $132.09, indicating a potential upside of 35.35%. Gevo has a consensus target price of $6.58, indicating a potential upside of 287.25%. Given Gevo’s higher probable upside, analysts clearly believe Gevo is more favorable than Expand Energy.

Insider & Institutional Ownership

97.9% of Expand Energy shares are held by institutional investors. Comparatively, 35.2% of Gevo shares are held by institutional investors. 0.2% of Expand Energy shares are held by company insiders. Comparatively, 7.1% of Gevo shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Expand Energy has a beta of 0.36, suggesting that its share price is 64% less volatile than the S&P 500. Comparatively, Gevo has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.

Summary

Expand Energy beats Gevo on 11 of the 15 factors compared between the two stocks.

About Expand Energy

Expand Energy Corporation is an independent natural gas producer principally in the United States. Expand Energy Corporation, formerly known as Chesapeake Energy Corporation, is based in OKLAHOMA CITY.

About Gevo

Gevo, Inc. operates as a carbon abatement company. It operates through three segments: Gevo, Agri-Energy, and Renewable Natural Gas. The company focuses on transforming renewable energy into energy-dense liquid hydrocarbons that can be used as renewable fuels. It offers renewable gasoline and diesel, isobutanol, sustainable aviation fuel, renewable natural gas, isobutylene, ethanol, and animal feed and protein. The company was formerly known as Methanotech, Inc. and changed its name to Gevo, Inc. in March 2006. Gevo, Inc. was incorporated in 2005 and is headquartered in Englewood, Colorado.