Alta Mesa Resources (AMR) & Falcon Minerals (FLMN) Critical Analysis

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Alta Mesa Resources (NASDAQ:AMR) and Falcon Minerals (NASDAQ:FLMN) are both small-cap oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Alta Mesa Resources and Falcon Minerals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alta Mesa Resources 0 2 2 0 2.50
Falcon Minerals 0 0 3 0 3.00

Alta Mesa Resources currently has a consensus price target of $8.30, suggesting a potential upside of 609.40%. Falcon Minerals has a consensus price target of $11.67, suggesting a potential upside of 36.77%. Given Alta Mesa Resources’ higher probable upside, research analysts plainly believe Alta Mesa Resources is more favorable than Falcon Minerals.

Volatility & Risk

Alta Mesa Resources has a beta of 1.74, suggesting that its stock price is 74% more volatile than the S&P 500. Comparatively, Falcon Minerals has a beta of -0.07, suggesting that its stock price is 107% less volatile than the S&P 500.

Profitability

This table compares Alta Mesa Resources and Falcon Minerals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alta Mesa Resources N/A -2.39% -1.75%
Falcon Minerals N/A 10.63% 2.61%

Institutional and Insider Ownership

50.1% of Alta Mesa Resources shares are owned by institutional investors. Comparatively, 71.4% of Falcon Minerals shares are owned by institutional investors. 0.2% of Alta Mesa Resources shares are owned by insiders. Comparatively, 8.6% of Falcon Minerals shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Falcon Minerals pays an annual dividend of $0.38 per share and has a dividend yield of 4.5%. Alta Mesa Resources does not pay a dividend.

Earnings & Valuation

This table compares Alta Mesa Resources and Falcon Minerals’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Alta Mesa Resources N/A N/A $1.89 million N/A N/A
Falcon Minerals N/A N/A $520,000.00 N/A N/A

Summary

Falcon Minerals beats Alta Mesa Resources on 7 of the 10 factors compared between the two stocks.

About Alta Mesa Resources

Alta Mesa Resources, Inc. focuses on the acquisition and development of unconventional oil and natural gas reserves in the Anadarko Basin. It also offers midstream energy services, including crude oil and gas gathering, processing, and marketing to producers of natural gas, natural gas liquids, crude oil, and condensate in the STACK Play region of Oklahoma. The company was formerly known as Silver Run Acquisition Corporation II and changed its name to Alta Mesa Resources, Inc. in February 2018. Alta Mesa Resources, Inc. was founded in 1987 and is based in Houston, Texas.

About Falcon Minerals

Falcon Minerals Corporation acquires, owns, maintains, and manages mineral interests, mineral royalties, and overriding royalties relating to onshore unconventional shale oil and natural gas properties in the United States; and any associated interests and royalties relating to conventional oil and natural gas properties. The company is based in Philadelphia, Pennsylvania.

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