Critical Analysis: Royale Energy (OTCMKTS:ROYL) versus TXO Partners (NYSE:TXO)

TXO Partners (NYSE:TXO) and Royale Energy (OTCMKTS:ROYL) are both small-cap oils/energy companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Valuation & Earnings

This table compares TXO Partners and Royale Energy’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TXO Partners	$380.72 million	1.46	-$103.99 million	($3.32)	-5.45
Royale Energy	$2.16 million	1.31	-$1.83 million	N/A	N/A

Royale Energy has lower revenue, but higher earnings than TXO Partners.

Profitability

This table compares TXO Partners and Royale Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TXO Partners	-27.31%	6.89%	5.16%
Royale Energy	N/A	N/A	N/A

Risk and Volatility

TXO Partners has a beta of -0.18, meaning that its share price is 118% less volatile than the S&P 500. Comparatively, Royale Energy has a beta of 0.21, meaning that its share price is 79% less volatile than the S&P 500.

Institutional and Insider Ownership

27.4% of TXO Partners shares are held by institutional investors. 61.8% of Royale Energy shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for TXO Partners and Royale Energy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TXO Partners	0	0	1	1	3.50
Royale Energy	0	0	0	0	N/A

TXO Partners currently has a consensus price target of $26.00, indicating a potential upside of 43.81%. Given TXO Partners’ higher probable upside, research analysts plainly believe TXO Partners is more favorable than Royale Energy.

Summary

TXO Partners beats Royale Energy on 8 of the 12 factors compared between the two stocks.

About TXO Partners

TXO Partners, L.P., an oil and natural gas company, focuses on the acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquid reserves in North America. Its acreage positions are concentrated in the Permian Basin of West Texas and New Mexico and the San Juan Basin of New Mexico and Colorado. The company was formerly known as TXO Energy Partners, L.P. and changed its name to TXO Partners, L.P. in May 2023. TXO Partners, L.P. was incorporated in 2012 and is based in Fort Worth, Texas.

About Royale Energy

Royale Energy, Inc. acquires, explores for, develops, produces, and sells oil and natural gas properties in the United States. Its principal operations are located in the Sacramento Basin and San Joaquin Basin in California, as well as in Utah, Texas, Oklahoma, Louisiana, and Colorado. Royale Energy, Inc. was incorporated in 1986 and is based in El Cajon, California.