Head to Head Contrast: Barnwell Industries (NYSE:BRN) vs. SM Energy (NYSE:SM)

SM Energy (NYSE:SM) and Barnwell Industries (NYSE:BRN) are both oils/energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, earnings, profitability, risk, analyst recommendations, valuation and dividends.

Insider & Institutional Ownership

94.6% of SM Energy shares are owned by institutional investors. Comparatively, 40.7% of Barnwell Industries shares are owned by institutional investors. 1.5% of SM Energy shares are owned by company insiders. Comparatively, 17.6% of Barnwell Industries shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

SM Energy pays an annual dividend of $0.72 per share and has a dividend yield of 1.5%. Barnwell Industries pays an annual dividend of $0.01 per share and has a dividend yield of 0.4%. SM Energy pays out 11.3% of its earnings in the form of a dividend. Barnwell Industries pays out -3.0% 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.

Risk and Volatility

SM Energy has a beta of 4.15, suggesting that its stock price is 315% more volatile than the S&P 500. Comparatively, Barnwell Industries has a beta of 0.11, suggesting that its stock price is 89% less volatile than the S&P 500.

Profitability

This table compares SM Energy and Barnwell Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SM Energy	31.80%	20.10%	11.34%
Barnwell Industries	-13.29%	-18.20%	-9.39%

Analyst Recommendations

This is a summary of recent ratings and price targets for SM Energy and Barnwell Industries, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SM Energy	0	3	6	0	2.67
Barnwell Industries	0	0	0	0	N/A

SM Energy currently has a consensus price target of $55.63, indicating a potential upside of 15.57%. Given SM Energy’s higher possible upside, analysts plainly believe SM Energy is more favorable than Barnwell Industries.

Earnings & Valuation

This table compares SM Energy and Barnwell Industries’ revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SM Energy	$2.37 billion	2.33	$817.88 million	$6.38	7.54
Barnwell Industries	$25.27 million	1.03	-$960,000.00	($0.33)	-7.85

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

Summary

SM Energy beats Barnwell Industries on 13 of the 15 factors compared between the two stocks.

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.

About Barnwell Industries

Barnwell Industries, Inc. acquires, develops, produces, and sells oil and natural gas in Canada. The company operates through three segments: Oil and Natural Gas, Land Investment, and Contract Drilling. It also acquires and develops crude oil and natural gas assets in the province of Alberta, as well as invests in land interests in Hawaii. In addition, the company owns and operates threes water well drilling rigs, two pump rigs, and other ancillary drilling and pump equipment; and drills water and water monitoring wells of varying depths. Further, it installs and repairs water pumping systems; and distributes trillium flow technologies. Barnwell Industries, Inc. was incorporated in 1956 and is based in Honolulu, Hawaii.