W&T Offshore (NYSE:WTI – Get Free Report) and Baytex Energy (NYSE:BTE – Get Free Report) are both energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, profitability, dividends, valuation, analyst recommendations and earnings.
Analyst Recommendations
This is a breakdown of recent ratings and price targets for W&T Offshore and Baytex Energy, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| W&T Offshore | 1 | 1 | 1 | 0 | 2.00 |
| Baytex Energy | 0 | 6 | 2 | 3 | 2.73 |
W&T Offshore presently has a consensus price target of $4.25, suggesting a potential upside of 1.31%. Given W&T Offshore’s higher possible upside, research analysts plainly believe W&T Offshore is more favorable than Baytex Energy.
Valuation and Earnings
This table compares W&T Offshore and Baytex Energy”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| W&T Offshore | $501.46 million | 1.26 | -$150.06 million | ($0.73) | -5.75 |
| Baytex Energy | $2.56 billion | 1.48 | -$432.12 million | ($0.67) | -8.20 |
W&T Offshore has higher earnings, but lower revenue than Baytex Energy. Baytex Energy is trading at a lower price-to-earnings ratio than W&T Offshore, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
42.9% of W&T Offshore shares are owned by institutional investors. Comparatively, 46.1% of Baytex Energy shares are owned by institutional investors. 35.9% of W&T Offshore shares are owned by company insiders. Comparatively, 0.8% of Baytex Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Risk & Volatility
W&T Offshore has a beta of 0.35, suggesting that its stock price is 65% less volatile than the S&P 500. Comparatively, Baytex Energy has a beta of 0.4, suggesting that its stock price is 60% less volatile than the S&P 500.
Dividends
W&T Offshore pays an annual dividend of $0.04 per share and has a dividend yield of 1.0%. Baytex Energy pays an annual dividend of $0.06 per share and has a dividend yield of 1.1%. W&T Offshore pays out -5.5% of its earnings in the form of a dividend. Baytex Energy pays out -9.0% 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. Baytex Energy is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares W&T Offshore and Baytex Energy’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| W&T Offshore | -19.32% | N/A | -2.59% |
| Baytex Energy | -26.43% | -7.77% | -4.86% |
Summary
Baytex Energy beats W&T Offshore on 10 of the 17 factors compared between the two stocks.
About W&T Offshore
W&T Offshore, Inc. engages in the production, exploration, development, and acquisition of oil and natural gas properties. It focuses its operations in the Gulf of Mexico. The company was founded by Tracy W. Krohn in 1983 and is headquartered in Houston, TX.
About Baytex Energy
Baytex Energy Corp. is an oil & gas exploration and production company. The firm engages in the acquisition, development and production of crude oil and natural gas in the Western Canadian Sedimentary Basin and in the Eagle Ford in the United States. The company was founded on June 3, 1993 and is headquartered in Calgary, Canada.
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