SM Energy (NYSE:SM) vs. FEC Resources (OTCMKTS:FECOF) Critical Review

SM Energy (NYSE:SM) and FEC Resources (OTCMKTS:FECOF) are both oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, earnings, institutional ownership, profitability and dividends.

Profitability

This table compares SM Energy and FEC Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SM Energy	33.89%	19.62%	10.87%
FEC Resources	N/A	131.17%	114.19%

Insider and Institutional Ownership

94.6% of SM Energy shares are held by institutional investors. Comparatively, 0.0% of FEC Resources shares are held by institutional investors. 1.5% of SM Energy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

SM Energy has a beta of 4.14, meaning that its stock price is 314% more volatile than the S&P 500. Comparatively, FEC Resources has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for SM Energy and FEC Resources, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SM Energy	0	6	6	1	2.62
FEC Resources	0	0	0	0	0.00

SM Energy currently has a consensus target price of $51.90, suggesting a potential upside of 30.73%. Given SM Energy’s stronger consensus rating and higher probable upside, research analysts clearly believe SM Energy is more favorable than FEC Resources.

Earnings and Valuation

This table compares SM Energy and FEC Resources”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SM Energy	$2.37 billion	1.91	$817.88 million	$7.16	5.54
FEC Resources	N/A	N/A	-$190,000.00	N/A	N/A

SM Energy has higher revenue and earnings than FEC Resources.

Summary

SM Energy beats FEC Resources on 10 of the 12 factors compared between the two stocks.

About SM Energy

SM Energy Company, an independent energy company, engages in the acquisition, exploration, development, and production of oil, gas, and natural gas liquids in the state of Texas. It has working interests in oil and gas producing wells in the Midland Basin and South Texas. The company was formerly known as St. Mary Land & Exploration Company and changed its name to SM Energy Company in May 2010. SM Energy Company was founded in 1908 and is headquartered in Denver, Colorado.

About FEC Resources

FEC Resources Inc. engages in the exploration and development of oil and gas properties in the Philippines. The company, through its 6.8% interest in Forum Energy Limited, primarily owns a 70% interest in the GSEC101 offshore license covering an area of approximately 10,360 square kilometers located to the northwest of the Philippine Island of Palawan. FEC Resources Inc. is headquartered in Vancouver, Canada. FEC Resources Inc. operates as a subsidiary of PXP Energy Corporation.