Contrasting Royal Dutch Shell (RDS.B) and Andeavor (ANDV)

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Royal Dutch Shell (NYSE:RDS.B) and Andeavor (NYSE:ANDV) are both large-cap oils/energy companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, dividends, institutional ownership, earnings, valuation and profitability.

Analyst Ratings

This is a breakdown of recent ratings for Royal Dutch Shell and Andeavor, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Royal Dutch Shell 0 1 0 0 2.00
Andeavor 0 9 5 0 2.36

Andeavor has a consensus target price of $145.25, suggesting a potential downside of 5.37%. Given Andeavor’s stronger consensus rating and higher possible upside, analysts plainly believe Andeavor is more favorable than Royal Dutch Shell.

Dividends

Royal Dutch Shell pays an annual dividend of $3.76 per share and has a dividend yield of 5.6%. Andeavor pays an annual dividend of $2.36 per share and has a dividend yield of 1.5%. Andeavor pays out 36.5% of its earnings in the form of a dividend.

Profitability

This table compares Royal Dutch Shell and Andeavor’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Royal Dutch Shell 5.64% 9.22% 4.50%
Andeavor 4.91% 8.52% 3.90%

Institutional and Insider Ownership

5.5% of Royal Dutch Shell shares are owned by institutional investors. Comparatively, 77.7% of Andeavor shares are owned by institutional investors. 1.0% of Royal Dutch Shell shares are owned by insiders. Comparatively, 7.0% of Andeavor shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Risk and Volatility

Royal Dutch Shell has a beta of 1.05, indicating that its stock price is 5% more volatile than the S&P 500. Comparatively, Andeavor has a beta of 1.19, indicating that its stock price is 19% more volatile than the S&P 500.

Earnings and Valuation

This table compares Royal Dutch Shell and Andeavor’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Royal Dutch Shell $305.18 billion 0.92 $12.98 billion N/A N/A
Andeavor $34.98 billion 0.66 $1.53 billion $6.47 23.72

Royal Dutch Shell has higher revenue and earnings than Andeavor.

Summary

Royal Dutch Shell beats Andeavor on 8 of the 15 factors compared between the two stocks.

About Royal Dutch Shell

Royal Dutch Shell Plc engages in the oil and natural gas production. It operates through the following segments: Integrated Gas, Upstream, Downstream, and Corporate. The Integrated Gas segment manages liquefied natural gas activities and the conversion of natural gas into gas to liquids fuels and other products. The Upstream segment manages the exploration for and extraction of crude oil, natural gas, and natural gas liquids. The Downstream segment manages different oil products and chemical activities as part of an integrated value chain, including trading activities, what turns crude oil and other feedstock into a range of products which are moved and marketed around the world for domestic, and industrial and transport use. The Corporate segment comprises holdings and treasury, self-insurance activities, and headquarters and central functions of the company. The company was founded in February 1907 and is headquartered in The Hague, Netherlands.

About Andeavor

Andeavor, through its subsidiaries, operates as an independent petroleum refining, logistics, and marketing company in the United States. The company operates in three segments: Marketing, Logistics, and Refining. The Marketing segment sells gasoline and diesel fuel through retail, branded, and unbranded channels. This segment operates a network of 3,255 retail stations under the ARCO, Shell, Mobil, and SUPERAMERICA brands. The Logistics segment gathers and transports crude oil by pipelines, as well as by trucks. It operates approximately 13 million barrels of crude oil, feedstock, blendstock, refined product, and asphalt storage tanks. The Refining segment buys and refines crude oil and other feed stocks into transportation fuels, such as gasoline and gasoline blend stocks, jet fuel, and diesel fuel, as well as other products, including heavy fuel oils, liquefied petroleum gas, petroleum coke, calcined coke, and asphalt. It also sells refined products in the bulk market principally to independent unbranded distributors, other refining and marketing companies, utilities, railroads, airlines, and marine and industrial end-users in the western United States. This segment owns and operates 10 petroleum refineries with a combined crude oil capacity of approximately 1,157 thousand barrels per day. The company was formerly known as Tesoro Corporation and changed its name to Andeavor in August 2017. Andeavor was founded in 1968 and is headquartered in San Antonio, Texas.

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