ECA Marcellus Trust I (OTCMKTS:ECT) & SM Energy (NYSE:SM) Critical Contrast

ECA Marcellus Trust I (OTCMKTS:ECT) and SM Energy (NYSE:SM) are both oils/energy companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, valuation, profitability, analyst recommendations, earnings and dividends.

Earnings and Valuation

This table compares ECA Marcellus Trust I and SM Energy”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ECA Marcellus Trust I	$4.15 million	1.70	$2.90 million	N/A	N/A
SM Energy	$2.37 billion	1.83	$817.88 million	$7.16	5.30

SM Energy has higher revenue and earnings than ECA Marcellus Trust I.

Profitability

This table compares ECA Marcellus Trust I and SM Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ECA Marcellus Trust I	46.53%	4.37%	4.32%
SM Energy	33.89%	19.62%	10.87%

Risk & Volatility

ECA Marcellus Trust I has a beta of 2, meaning that its stock price is 100% more volatile than the S&P 500. Comparatively, SM Energy has a beta of 4.14, meaning that its stock price is 314% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for ECA Marcellus Trust I and SM Energy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ECA Marcellus Trust I	0	0	0	0	0.00
SM Energy	0	6	5	1	2.58

SM Energy has a consensus target price of $51.90, indicating a potential upside of 36.77%. Given SM Energy’s stronger consensus rating and higher probable upside, analysts clearly believe SM Energy is more favorable than ECA Marcellus Trust I.

Insider and Institutional Ownership

2.0% of ECA Marcellus Trust I shares are held by institutional investors. Comparatively, 94.6% of SM Energy shares are held by institutional investors. 1.5% of SM Energy shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

SM Energy beats ECA Marcellus Trust I on 13 of the 14 factors compared between the two stocks.

About ECA Marcellus Trust I

ECA Marcellus Trust I is a statutory trust. It owns royalty interest in producing wells and development wells. It also acquires horizontal natural gas development wells to be drilled to the Marcellus Shale formation. The company was founded in March 2010 and is headquartered in Houston, TX.

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.