Contrasting Golar LNG (NASDAQ:GLNG) and BP (NYSE:BP)

Golar LNG (NASDAQ:GLNG) and BP (NYSE:BP) are both energy companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, institutional ownership, risk, profitability, valuation and analyst recommendations.

Insider & Institutional Ownership

92.2% of Golar LNG shares are held by institutional investors. Comparatively, 11.0% of BP shares are held by institutional investors. 0.0% of Golar LNG shares are held by company insiders. Comparatively, 1.0% of BP shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Golar LNG and BP”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Golar LNG	$260.37 million	16.21	$50.84 million	$0.03	1,346.00
BP	$194.63 billion	0.47	$381.00 million	$0.21	164.93

BP has higher revenue and earnings than Golar LNG. BP is trading at a lower price-to-earnings ratio than Golar LNG, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Golar LNG and BP’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Golar LNG	1.04%	6.82%	3.98%
BP	0.29%	9.08%	2.57%

Analyst Ratings

This is a breakdown of current recommendations for Golar LNG and BP, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Golar LNG	0	0	4	2	3.33
BP	1	10	2	3	2.44

Golar LNG currently has a consensus price target of $53.00, suggesting a potential upside of 31.25%. BP has a consensus price target of $36.0556, suggesting a potential upside of 4.10%. Given Golar LNG’s stronger consensus rating and higher possible upside, research analysts clearly believe Golar LNG is more favorable than BP.

Dividends

Golar LNG pays an annual dividend of $1.00 per share and has a dividend yield of 2.5%. BP pays an annual dividend of $1.90 per share and has a dividend yield of 5.5%. Golar LNG pays out 3,333.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. BP pays out 904.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Golar LNG has raised its dividend for 2 consecutive years. BP is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Golar LNG has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500. Comparatively, BP has a beta of 0.57, meaning that its share price is 43% less volatile than the S&P 500.

About Golar LNG

Golar LNG Limited designs, converts, owns, and operates marine infrastructure for the liquefaction of natural gas. The company operates through three segments: FLNG, Corporate and Other, and Shipping. It engages in the regasification, storage, and offloading of liquefied natural gas (LNG); operation of floating liquefaction natural gas (FLNG) vessels or projects; transportation of LNG carriers; and vessel management activities. Golar LNG Limited was founded in 1946 and is headquartered in Hamilton, Bermuda.

About BP

BP p.l.c. provides carbon products and services. The company operates through Gas & Low Carbon Energy, Oil Production & Operations, and Customers & Products segments. It engages in the production of natural gas, and integrated gas and power; trading of gas; operation of onshore and offshore wind power, as well as hydrogen and carbon capture and storage facilities; trading and marketing of renewable and non-renewable power; and production of crude oil. In addition, the company involved in convenience and retail fuel, EV charging, Castrol lubricant, aviation, B2B, and midstream businesses; refining and oil trading; and bioenergy business. The company was founded in 1908 and is headquartered in London, the United Kingdom.