Critical Review: Legacy Reserves (OTCMKTS:LGCYQ) versus Veren (NYSE:VRN)

Legacy Reserves (OTCMKTS:LGCYQ) and Veren (NYSE:VRN) are both oils/energy companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, earnings, risk and dividends.

Analyst Recommendations

This is a summary of current ratings and target prices for Legacy Reserves and Veren, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Legacy Reserves	0	0	0	0	0.00
Veren	0	0	2	1	3.33

Veren has a consensus target price of $12.67, suggesting a potential upside of 138.99%. Given Veren’s stronger consensus rating and higher probable upside, analysts clearly believe Veren is more favorable than Legacy Reserves.

Institutional and Insider Ownership

49.4% of Veren shares are owned by institutional investors. 0.8% of Legacy Reserves shares are owned by company insiders. Comparatively, 0.3% of Veren shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Legacy Reserves and Veren’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Legacy Reserves	N/A	N/A	N/A
Veren	26.93%	12.23%	6.80%

Valuation & Earnings

This table compares Legacy Reserves and Veren”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Legacy Reserves	N/A	N/A	N/A	N/A	N/A
Veren	$2.59 billion	1.26	$422.48 million	$1.40	3.79

Veren has higher revenue and earnings than Legacy Reserves.

Summary

Veren beats Legacy Reserves on 9 of the 10 factors compared between the two stocks.

About Legacy Reserves

Legacy Reserves Inc., an independent energy company, engages in the acquisition, development, and production of oil and natural gas properties in the United States. It focuses on the horizontal development of unconventional plays in the Permian Basin and the management of shallow-decline oil and natural gas wells in the regions of Permian Basin, East Texas, Rocky Mountain, and Mid-Continent. As of December 31, 2018, the company had proved reserves of approximately 164.9 million barrels of crude oil equivalent covering natural gas, as well as oil and natural gas liquids. Legacy Reserves Inc. was founded in 2005 and is based in Midland, Texas. On June 18, 2019, Legacy Reserves Inc., along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.

About Veren

Veren Inc. explores, develops, and produces oil and gas properties in Canada and the United States. The company focuses on crude oil, tight oil, natural gas liquids, shale gas, and natural gas reserves. Its properties are located in the provinces of Saskatchewan, Alberta, British Columbia, and Manitoba; and the states of North Dakota. The company was formerly known as Crescent Point Energy Corp. and changed its name to Veren Inc. in May 2024. Veren Inc. was incorporated in 1994 and is headquartered in Calgary, Canada.