Analyzing Chesapeake Granite Wash Trust (OTCMKTS:CHKR) & Ecopetrol (NYSE:EC)

Chesapeake Granite Wash Trust (OTCMKTS:CHKR) and Ecopetrol (NYSE:EC) are both oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, dividends, analyst recommendations and valuation.

Institutional and Insider Ownership

1.5% of Ecopetrol shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Chesapeake Granite Wash Trust and Ecopetrol’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chesapeake Granite Wash Trust 85.45% 26.42% 26.42%
Ecopetrol 11.48% 7.14% 2.96%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Chesapeake Granite Wash Trust and Ecopetrol, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chesapeake Granite Wash Trust 0 0 0 0 N/A
Ecopetrol 1 1 3 0 2.40

Ecopetrol has a consensus target price of $13.85, suggesting a potential upside of 6.62%. Given Ecopetrol’s higher possible upside, analysts clearly believe Ecopetrol is more favorable than Chesapeake Granite Wash Trust.

Risk & Volatility

Chesapeake Granite Wash Trust has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, Ecopetrol has a beta of 1.86, meaning that its share price is 86% more volatile than the S&P 500.

Dividends

Chesapeake Granite Wash Trust pays an annual dividend of $0.03 per share and has a dividend yield of 7.0%. Ecopetrol pays an annual dividend of $0.80 per share and has a dividend yield of 6.2%. Ecopetrol pays out 39.8% of its earnings in the form of a dividend.

Valuation & Earnings

This table compares Chesapeake Granite Wash Trust and Ecopetrol’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Chesapeake Granite Wash Trust $9.81 million N/A $7.63 million N/A N/A
Ecopetrol $21.45 billion 1.25 $19.24 billion $2.01 6.46

Ecopetrol has higher revenue and earnings than Chesapeake Granite Wash Trust.

Summary

Ecopetrol beats Chesapeake Granite Wash Trust on 7 of the 12 factors compared between the two stocks.

Chesapeake Granite Wash Trust Company Profile

Chesapeake Granite Wash Trust owns royalty interests in oil, natural gas liquids, and natural gas properties located in the Colony Granite Wash play in Washita County in the Anadarko Basin of Western Oklahoma. The company has royalty interests in 69 producing wells and 118 development wells, and in approximately 26,400 net acres of area. As of December 31, 2020, its reserve estimates for the royalty interests included 2,736 thousand barrels of oil equivalent of proved developed reserves. Chesapeake Granite Wash Trust was founded in 2011 and is based in Houston, Texas.

Ecopetrol Company Profile

Ecopetrol S.A. operates as an integrated oil and gas company. The company operates through Exploration and Production; Transport and Logistics; and Refining, Petrochemical and Biofuels segments. It engages in the exploration, production, and sale of oil and gas. It also transports and distributes hydrocarbons and derivative products. As of December 31, 2019, the company had approximately 9,106 kilometers of crude oil and multi-purpose pipelines. In addition, the company manufactures and commercializes polypropylene resins, compounds, and masterbatches; and offers refined and petrochemical products, and biofuels, as well as industrial service sales to customers. It has operations in Colombia, the United States, Asia, Central America and the Caribbean, Europe, South America, and internationally. Ecopetrol S.A. has a strategic alliance with Occidental Petroleum Corporation. The company was formerly known as Empresa Colombiana de Petróleos and changed its name to Ecopetrol S.A. in June 2003. Ecopetrol S.A. was founded in 1948 and is based in Bogotá, Colombia.

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