Comparing Braskem (NYSE:BAK) & Repsol (OTCMKTS:REPYY)

Repsol (OTCMKTS:REPYY) and Braskem (NYSE:BAK) are both energy companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares Repsol and Braskem’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Repsol	1.33%	9.06%	4.17%
Braskem	-7.36%	N/A	-0.30%

Risk and Volatility

Repsol has a beta of 0.62, meaning that its share price is 38% less volatile than the S&P 500. Comparatively, Braskem has a beta of 1.81, meaning that its share price is 81% more volatile than the S&P 500.

Institutional & Insider Ownership

0.3% of Repsol shares are held by institutional investors. 1.0% of Repsol shares are held by company insiders. Comparatively, 0.0% of Braskem shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Repsol and Braskem”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Repsol	$61.38 billion	0.35	$1.90 billion	$1.07	17.36
Braskem	$73.77 billion	0.02	-$2.10 billion	($2.28)	-1.27

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Repsol and Braskem, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Repsol	1	5	2	1	2.33
Braskem	2	5	0	0	1.71

Braskem has a consensus price target of $4.40, suggesting a potential upside of 52.30%. Given Braskem’s higher possible upside, analysts plainly believe Braskem is more favorable than Repsol.

Dividends

Repsol pays an annual dividend of $0.92 per share and has a dividend yield of 5.0%. Braskem pays an annual dividend of $0.63 per share and has a dividend yield of 21.8%. Repsol pays out 86.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Braskem pays out -27.6% of its earnings in the form of a dividend. Braskem is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Repsol beats Braskem on 12 of the 17 factors compared between the two stocks.

About Repsol

Repsol, S.A. operates as a multi-e energy company worldwide. Its Upstream segment engages in the exploration, development, and production of crude oil and natural gas reserves, as well as develops low-carbon geological solutions. The company's Industrial segment is involved in refining activities and petrochemicals business; the trading, transport, and sale of crude oil, natural gas, and fuels; and development of hydrogen, biomethane, sustainable biofuels, and synthetic fuels. Its Customer segment is involved in mobility; and sale of fuel products, electricity and gas, lubricants, and other specialties. The company's Low-Carbon Generation segment engages in the low-emissions electricity generation and renewable sources. The company also offers asphalt products; installs, operates, and manages service stations; provides maritime services; constructs and operates oil refineries; explores and produces hydrocarbons; offers human resource; distributes and supplies electricity; and develops new energy projects, solar, and wind projects, as well as produces and sells chemical products and lubricants. In addition, it is involved in fuel and special products sale, research, trading and transport, insurance and reinsurance, safety, and financing activities; development of production processes, storage, transport, use, consumption, and transformation of hydrogen; decarbonization activities; and promotion, design, construction, and operation of molecular recycling facilities. Further, the company produces synthetic oil cloths; and invests in liquefaction plant project. The company was formerly known as Repsol YPF, S.A. and changed its name to Repsol, S.A. in May 2012. Repsol, S.A. was founded in 1927 and is headquartered in Madrid, Spain.

About Braskem

Braskem S.A., together with its subsidiaries, produces and sells thermoplastic resins. The company operates through three segments: Brazil, United States and Europe, and Mexico. The Brazil segment produces and sells olefins, including ethylene, polymer and chemical grade propylene, butadiene, and butene-1; benzene, toluene, and xylenes products; fuels, such as automotive gasoline, liquefied petroleum gas, ethyl tertiary-butyl ether, and methyl tertiary-butyl ether; intermediates, such as cumene; aliphatics, aromatics, and hydrogenated solvents; and specialties comprising isoprene, dicyclopentadiene, piperylene, nonene, tetramer, polyisobutylene, and hydrocarbon resins. This segment also produces and sells polyethylene (PE) and polypropylene (PP); supplies electricity and other inputs to second-generation producers; produces and sells of PE, including the production of green PE from renewable resources; and produces and sells polyvinyl chloride and caustic soda. The United States and Europe segment produces and sells PP in the United States and Germany. The Mexico segment produces and sells ethylene, high-density PE, and low-density PE in Mexico. It also manufactures, sells, imports, and exports chemicals, petrochemicals, and fules; produces, supplies, and sells utilities, such as steam, water, compressed air, and industrial gases; and provides industrial services. The company was formerly known as Copene Petroquímica do Nordeste S.A. and changed its name to Braskem S.A. in 2002. Braskem S.A. was founded in 1972 and is headquartered in São Paulo, Brazil.