Head to Head Contrast: Kosmos Energy (NYSE:KOS) & Talos Energy (NYSE:TALO)

Kosmos Energy (NYSE:KOS) and Talos Energy (NYSE:TALO) are both small-cap oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Kosmos Energy and Talos Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kosmos Energy	0	3	2	0	2.40
Talos Energy	0	2	7	0	2.78

Kosmos Energy currently has a consensus price target of $5.52, indicating a potential upside of 143.71%. Talos Energy has a consensus price target of $15.56, indicating a potential upside of 78.49%. Given Kosmos Energy’s higher probable upside, research analysts clearly believe Kosmos Energy is more favorable than Talos Energy.

Valuation and Earnings

This table compares Kosmos Energy and Talos Energy”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kosmos Energy	$1.68 billion	0.65	$213.52 million	$0.39	5.81
Talos Energy	$1.97 billion	0.80	$187.33 million	($0.51)	-17.09

Kosmos Energy has higher earnings, but lower revenue than Talos Energy. Talos Energy is trading at a lower price-to-earnings ratio than Kosmos Energy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Kosmos Energy and Talos Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kosmos Energy	12.21%	31.08%	6.53%
Talos Energy	3.95%	-1.98%	-0.86%

Risk & Volatility

Kosmos Energy has a beta of 2.31, suggesting that its stock price is 131% more volatile than the S&P 500. Comparatively, Talos Energy has a beta of 1.79, suggesting that its stock price is 79% more volatile than the S&P 500.

Institutional and Insider Ownership

95.3% of Kosmos Energy shares are held by institutional investors. Comparatively, 89.3% of Talos Energy shares are held by institutional investors. 2.0% of Kosmos Energy shares are held by company insiders. Comparatively, 0.8% of Talos Energy shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Kosmos Energy beats Talos Energy on 9 of the 14 factors compared between the two stocks.

About Kosmos Energy

Kosmos Energy Ltd., together with its subsidiaries, engages in the exploration, development, and production of oil and gas along the Atlantic Margins in the United States. The company’s primary assets include production projects located in offshore Ghana, Equatorial Guinea, and the U.S. Gulf of Mexico, as well as gas projects located in offshore Mauritania and Senegal. It undertakes a proven basin exploration program in Equatorial Guinea and the U.S. Gulf of Mexico. Kosmos Energy Ltd. was founded in 2003 and is headquartered in Dallas, Texas.

About Talos Energy

Talos Energy Inc., through its subsidiaries, engages in the exploration and production of oil, natural gas, and natural gas liquids in the United States and Mexico. It also engages in the development of carbon capture and sequestration. Talos Energy Inc. was founded in 2011 and is headquartered in Houston, Texas.