The investment landscape for energy companies is evolving, with TotalEnergies (NYSE:TTE) and CVR Energy (NYSE:CVI) emerging as notable players. A recent analysis contrasts the two firms across various metrics, including dividends, earnings, risk profiles, and institutional ownership, to determine which may be the preferable investment option.
Comparative Volatility and Risk Assessment
When evaluating volatility, TotalEnergies shows a beta of 0.22, indicating that its stock price is significantly less volatile—approximately 78%—than that of the S&P 500 Index. In contrast, CVR Energy has a beta of 1.14, suggesting a 14% increase in volatility compared to the broader market. This notable difference implies that TotalEnergies may offer a more stable investment, appealing to those with a lower risk tolerance.
Financial Performance and Valuation Analysis
A comparison of earnings reveals that TotalEnergies outperforms CVR Energy in both gross revenue and earnings per share. TotalEnergies is currently trading at a lower price-to-earnings ratio, which may indicate a more attractive valuation for potential investors.
According to MarketBeat, TotalEnergies has a consensus target price of $66.96, suggesting a potential upside of 6.88%. Conversely, CVR Energy presents a higher upside potential with a target price of $29.25, reflecting a potential increase of 28.33%. This disparity in upside has led analysts to favor CVR Energy as a more appealing option, despite TotalEnergies’ stronger financial metrics.
Profitability metrics further illustrate the companies’ standings. TotalEnergies maintains superior net margins, return on equity, and return on assets when juxtaposed with CVR Energy. This suggests that TotalEnergies not only generates more revenue but also manages its finances more effectively.
Institutional Ownership and Market Sentiment
Institutional ownership plays a crucial role in understanding market confidence. Approximately 16.5% of TotalEnergies shares are held by institutional investors, whereas a striking 98.9% of CVR Energy shares are institutionally owned. This high level of institutional investment in CVR Energy may signal strong market confidence in the company’s future performance.
Notably, 0.0% of CVR Energy shares are held by insiders, indicating a lack of insider investment, which can sometimes raise concerns about company leadership alignment with shareholder interests.
Company Profiles
TotalEnergies SE, headquartered in Courbevoie, France, operates as a multi-energy company involved in the production and marketing of oil, biofuels, natural gas, green gases, renewables, and electricity. Its diverse operations span five segments: Exploration & Production, Integrated LNG, Integrated Power, Refining & Chemicals, and Marketing & Services. Founded in 1924, TotalEnergies has positioned itself as a global energy leader.
On the other hand, CVR Energy, based in Sugar Land, Texas, focuses on petroleum refining and nitrogen fertilizer manufacturing. The company operates two segments: Petroleum and Nitrogen Fertilizer. Its petroleum segment refines and supplies various refined products, while the nitrogen fertilizer segment produces and markets products primarily to agricultural customers. Established in 1906, CVR Energy is a subsidiary of Icahn Enterprises L.P.
In summary, while TotalEnergies demonstrates superior financial performance across multiple metrics, CVR Energy presents a higher potential upside according to analyst projections. Investors may consider their risk tolerance and investment strategy when deciding between these two distinct energy companies.
