Analyzing Gevo (NASDAQ:GEVO) & Texas Pacific Land (NYSE:TPL)

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

Institutional & Insider Ownership

35.2% of Gevo shares are owned by institutional investors. Comparatively, 59.9% of Texas Pacific Land shares are owned by institutional investors. 7.1% of Gevo shares are owned by insiders. Comparatively, 6.9% of Texas Pacific Land shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Gevo and Texas Pacific Land”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gevo	$160.58 million	2.55	-$33.84 million	($0.13)	-12.92
Texas Pacific Land	$798.19 million	33.56	$481.38 million	$7.30	53.20

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

Profitability

This table compares Gevo and Texas Pacific Land’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gevo	-19.38%	-5.06%	-3.41%
Texas Pacific Land	60.03%	35.52%	31.95%

Risk and Volatility

Gevo has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.Comparatively, Texas Pacific Land has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Gevo and Texas Pacific Land, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gevo	2	1	2	0	2.00
Texas Pacific Land	1	1	1	1	2.50

Gevo currently has a consensus price target of $6.58, indicating a potential upside of 291.87%. Texas Pacific Land has a consensus price target of $639.00, indicating a potential upside of 64.53%. Given Gevo’s higher possible upside, equities analysts plainly believe Gevo is more favorable than Texas Pacific Land.

Summary

Texas Pacific Land beats Gevo on 11 of the 15 factors compared between the two stocks.

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.

About Texas Pacific Land

Texas Pacific Land Corporation engages in the land and resource management, and water services and operations businesses. The company owns a 1/128th nonparticipating perpetual oil and gas royalty interest (NPRI) under approximately 85,000 acres of land; a 1/16th NPRI under approximately 371,000 acres of land; and approximately 4,000 additional net royalty acres, total of approximately 195,000 NRA located in the western part of Texas. The Land and Resource Management segment manages surface acres of land, and oil and gas royalty interest in West Texas. This segment also engages in easements, such as transporting oil, gas and related hydrocarbons, power line and utility, and subsurface wellbore easements. In addition, this segment leases its land for processing, storage, and compression facilities and roads; and is involved in sale of materials, such as caliche, sand, and other material, as well as sells land. The Water Services and Operations segment provides full-service water offerings, including water sourcing, produced-water treatment, infrastructure development, and disposal solutions to operators in the Permian Basin. This segment also holds produced water royalties. Texas Pacific Land Corporation was founded in 1888 and is headquartered in Dallas, Texas.