Critical Review: Legacy Reserves (OTCMKTS:LGCYQ) & Birchcliff Energy (OTCMKTS:BIREF)

Birchcliff Energy (OTCMKTS:BIREF) and Legacy Reserves (OTCMKTS:LGCYQ) are both oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Birchcliff Energy and Legacy Reserves, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Birchcliff Energy	0	1	1	0	2.50
Legacy Reserves	0	0	0	0	N/A

Birchcliff Energy currently has a consensus price target of $4.38, suggesting a potential upside of 2.46%. Given Birchcliff Energy’s higher probable upside, equities research analysts plainly believe Birchcliff Energy is more favorable than Legacy Reserves.

Profitability

This table compares Birchcliff Energy and Legacy Reserves’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Birchcliff Energy	1.38%	0.45%	0.32%
Legacy Reserves	N/A	N/A	N/A

Earnings & Valuation

This table compares Birchcliff Energy and Legacy Reserves’ gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Birchcliff Energy	$548.41 million	2.09	$7.24 million	$0.03	142.38
Legacy Reserves	N/A	N/A	N/A	N/A	N/A

Birchcliff Energy has higher revenue and earnings than Legacy Reserves.

Insider and Institutional Ownership

0.8% of Birchcliff Energy shares are held by institutional investors. 1.5% of Birchcliff Energy shares are held by company insiders. Comparatively, 0.8% of Legacy Reserves shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Birchcliff Energy beats Legacy Reserves on 8 of the 8 factors compared between the two stocks.

About Birchcliff Energy

Birchcliff Energy Ltd., an intermediate oil and natural gas company, explores for, develops, and produces natural gas, light oil, condensate, and other natural gas liquids in Western Canada. The company holds interests in the areas of Montney/Doig Resource Play, including the Pouce Coupe and Gordondale properties in Alberta. Birchcliff Energy Ltd. was founded in 2004 and is headquartered in Calgary, Canada.

About Legacy Reserves

Legacy Reserves Inc., an independent energy company, engages in the acquisition, development, and production of oil and natural gas properties in the United States. It focuses on the horizontal development of unconventional plays in the Permian Basin and the management of shallow-decline oil and natural gas wells in the regions of Permian Basin, East Texas, Rocky Mountain, and Mid-Continent. As of December 31, 2018, the company had proved reserves of approximately 164.9 million barrels of crude oil equivalent covering natural gas, as well as oil and natural gas liquids. Legacy Reserves Inc. was founded in 2005 and is based in Midland, Texas. On June 18, 2019, Legacy Reserves Inc., along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.