Critical Contrast: Northern Oil and Gas (NYSE:NOG) versus Tourmaline Oil (OTCMKTS:TRMLF)

Northern Oil and Gas (NYSE:NOG) and Tourmaline Oil (OTCMKTS:TRMLF) are both energy companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Institutional & Insider Ownership

98.8% of Northern Oil and Gas shares are owned by institutional investors. Comparatively, 1.8% of Tourmaline Oil shares are owned by institutional investors. 2.8% of Northern Oil and Gas shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Northern Oil and Gas has a beta of 0.9, meaning that its stock price is 10% less volatile than the S&P 500. Comparatively, Tourmaline Oil has a beta of -0.21, meaning that its stock price is 121% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Northern Oil and Gas and Tourmaline Oil, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northern Oil and Gas	2	5	3	0	2.10
Tourmaline Oil	1	5	3	1	2.40

Northern Oil and Gas presently has a consensus price target of $31.22, suggesting a potential upside of 21.14%. Tourmaline Oil has a consensus price target of $65.00, suggesting a potential upside of 42.76%. Given Tourmaline Oil’s stronger consensus rating and higher possible upside, analysts clearly believe Tourmaline Oil is more favorable than Northern Oil and Gas.

Valuation and Earnings

This table compares Northern Oil and Gas and Tourmaline Oil”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northern Oil and Gas	$2.48 billion	1.11	$38.76 million	($5.18)	-4.98
Tourmaline Oil	$4.72 billion	3.75	$187.99 million	$0.72	63.24

Tourmaline Oil has higher revenue and earnings than Northern Oil and Gas. Northern Oil and Gas is trading at a lower price-to-earnings ratio than Tourmaline Oil, indicating that it is currently the more affordable of the two stocks.

Dividends

Northern Oil and Gas pays an annual dividend of $1.80 per share and has a dividend yield of 7.0%. Tourmaline Oil pays an annual dividend of $1.44 per share and has a dividend yield of 3.2%. Northern Oil and Gas pays out -34.7% of its earnings in the form of a dividend. Tourmaline Oil pays out 200.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Northern Oil and Gas has increased its dividend for 4 consecutive years. Northern Oil and Gas is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Northern Oil and Gas and Tourmaline Oil’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northern Oil and Gas	-25.35%	18.69%	6.85%
Tourmaline Oil	6.05%	9.05%	6.25%

Summary

Tourmaline Oil beats Northern Oil and Gas on 9 of the 17 factors compared between the two stocks.

About Northern Oil and Gas

Northern Oil and Gas, Inc., an independent energy company, engages in the acquisition, exploration, exploitation, development, and production of crude oil and natural gas properties in the United States. It primarily holds interests in the Williston Basin, the Appalachian Basin, and the Permian Basin in the United States. The company is based in Minnetonka, Minnesota.

About Tourmaline Oil

Tourmaline Oil Corp. explores for and develops oil and natural gas properties in the Western Canadian Sedimentary Basin. The company holds interests in properties located in the Alberta Deep Basin, Northeast British Columbia Montney, and the Peace River High Triassic oil complex. Tourmaline Oil Corp. was incorporated in 2008 and is headquartered in Calgary, Canada.