In light of the U.S. and China announcing a landmark deal to accelerate cooperation on climate change, GuruFocus’ Stock Comparison Table allows Premium members to compare financial strength and profitability metrics for several major energy companies headquartered in the U.S. and China: Chevron Corp. (CVX, Financial), Exxon Mobil Corp. (XOM, Financial), China Petroleum & Chemical Corp. (SNP, Financial) and PetroChina Co. Ltd. (PTR, Financial).
On Wednesday, John Kerry, U.S. Special Presidential Envoy for Climate, and his counterpart Xie Zhenhua announced an agreement in which the two countries aim to accelerate cooperation on climate change, including steps to reduce coal and methane emissions and protecting forests.
Kerry said that the agreement aims to promote ambition and set the stage for a successful COP26 climate summit. The Chinese special climate envoy added that the countries will work jointly with other parties; further, United Nations Secretary-General Antonio Guterres welcomed the agreement between the U.S. and China, saying that tackling the climate crisis “requires international collaboration and solidarity.”
GuruFocus’ stock comparison table allows users to compare multiple energy stocks in one table
As investors monitor the climate change deal between the U.S. and China, GuruFocus’ stock comparison table allows users to compare financial strength and profitability metrics of multiple energy stocks in one table. Table 1 shows the financial strength and valuation comparison table for the four energy stocks mentioned above.
Table 1
As Table 1 illustrates, China Petroleum & Chemical has the lowest price-to-GF-Value ratio and the highest cash-to-debt ratio among the four stocks, but also the highest debt-to-equity ratio and lowest Altman Z-score. Based on the metrics, GuruFocus ranks Sinopec’s financial strength 5 out of 10.
Shares of Sinopec traded around $49.29, showing the stock is modestly undervalued based on Thursday’s price-to-GF Value ratio of 0.83.
GuruFocus ranks Sinopec’s profitability 7 out of 10 on the back of a high Piotroski F-score of 9 and returns that outperform more than 76% of global competitors despite operating margins declining approximately 14% per year on average over the past five years and outperforming just over 51% of global energy companies.
Gurus with positions in Sinopec include Jim Simons (Trades, Portfolio)’ Renaissance Technologies, Jeremy Grantham (Trades, Portfolio)’s GMO and Sarah Ketterer (Trades, Portfolio)’s Causeway Capital Management.
PetroChina
Shares of PetroChina traded around $45.78, showing the stock is modestly overvalued based on Thursday’s price-to-GF Value ratio of 1.12.
GuruFocus ranks PetroChina’s financial strength 5 out of 10 on the back of interest coverage and debt ratios outperforming just over 51% of global competitors despite having a high Piotroski F-score of 8.
Table 1 shows that while PetroChina has a slightly higher interest coverage and Altman Z-score than does Sinopec, PetroChina has a lower cash-to-debt ratio.
Chevron and Exxon Mobil
Table 1 also shows that while Exxon Mobil has a slightly higher Altman Z-score than does Chevron, the Irving, Texas-based company has a lower cash-to-debt and interest coverage ratio. Based on the metrics, GuruFocus ranks Exxon Mobil’s financial strength lower than Chevron’s financial strength.
GuruFocus ranks Chevron’s profitability 5 out of 10 on the back of three-year revenue and earnings decline rates underperforming more than 63% of global competitors despite having a high Piotroski F-score of 7 and returns outperforming more than 64% of global energy companies.
On the other hand, Exxon Mobil’s profit margins and returns underperform more than 61% of global competitors.
Shares of Chevron traded around $114.16, showing the stock is fairly valued based on Thursday’s price-to-GF Value ratio of 1.03.
Likewise, shares of Exxon Mobil traded around $64.31, showing the stock is slightly undervalued based on Thursday’s price-to-GF Value ratio of 0.94.
