Financial Analysis: Gevo (NASDAQ:GEVO) versus Tourmaline Oil (OTCMKTS:TRMLF)

Tourmaline Oil (OTCMKTS:TRMLF) and Gevo (NASDAQ:GEVO) are both 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.

Institutional and Insider Ownership

1.8% of Tourmaline Oil shares are held by institutional investors. Comparatively, 35.2% of Gevo shares are held by institutional investors. 7.1% of Gevo 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.

Risk & Volatility

Tourmaline Oil has a beta of -0.24, suggesting that its stock price is 124% less volatile than the S&P 500. Comparatively, Gevo has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Tourmaline Oil and Gevo, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tourmaline Oil	0	6	4	1	2.55
Gevo	1	3	2	0	2.17

Tourmaline Oil currently has a consensus price target of $65.00, indicating a potential upside of 43.27%. Gevo has a consensus price target of $2.55, indicating a potential upside of 55.49%. Given Gevo’s higher probable upside, analysts clearly believe Gevo is more favorable than Tourmaline Oil.

Earnings & Valuation

This table compares Tourmaline Oil and Gevo”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tourmaline Oil	$4.72 billion	3.74	$187.99 million	$0.72	63.01
Gevo	$160.58 million	2.53	-$33.84 million	($0.89)	-1.84

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

Profitability

This table compares Tourmaline Oil and Gevo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tourmaline Oil	6.05%	9.05%	6.25%
Gevo	-119.93%	-6.50%	-4.22%

Summary

Tourmaline Oil beats Gevo on 11 of the 15 factors compared between the two stocks.

About Tourmaline Oil

Tourmaline Oil Corp. explores for and develops oil and natural gas properties in the Western Canadian Sedimentary Basin. The company holds interests in properties located in the Alberta Deep Basin, Northeast British Columbia Montney, and the Peace River High Triassic oil complex. Tourmaline Oil Corp. was incorporated in 2008 and is headquartered in Calgary, Canada.

About Gevo

Gevo, Inc. operates as a carbon abatement company. It operates through three segments: Gevo, Agri-Energy, and Renewable Natural Gas. The company focuses on transforming renewable energy into energy-dense liquid hydrocarbons that can be used as renewable fuels. It offers renewable gasoline and diesel, isobutanol, sustainable aviation fuel, renewable natural gas, isobutylene, ethanol, and animal feed and protein. The company was formerly known as Methanotech, Inc. and changed its name to Gevo, Inc. in March 2006. Gevo, Inc. was incorporated in 2005 and is headquartered in Englewood, Colorado.