Critical Comparison: Antero Resources (NYSE:AR) & Southwestern Energy (NYSE:SWN)

Antero Resources (NYSE:AR) and Southwestern Energy (NYSE:SWN) are both mid-cap oils/energy companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, dividends and valuation.

Profitability

This table compares Antero Resources and Southwestern Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Antero Resources	1.88%	0.45%	0.24%
Southwestern Energy	-48.91%	10.55%	4.80%

Earnings & Valuation

This table compares Antero Resources and Southwestern Energy’s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Antero Resources	$4.15 billion	2.09	$242.92 million	$0.20	139.45
Southwestern Energy	$5.64 billion	1.22	$1.56 billion	($1.74)	-3.59

Southwestern Energy has higher revenue and earnings than Antero Resources. Southwestern Energy is trading at a lower price-to-earnings ratio than Antero Resources, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

83.0% of Antero Resources shares are held by institutional investors. Comparatively, 87.0% of Southwestern Energy shares are held by institutional investors. 6.7% of Antero Resources shares are held by company insiders. Comparatively, 0.6% of Southwestern Energy 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.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Antero Resources and Southwestern Energy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Antero Resources	0	7	6	1	2.57
Southwestern Energy	1	10	2	0	2.08

Antero Resources currently has a consensus price target of $33.38, suggesting a potential upside of 19.70%. Southwestern Energy has a consensus price target of $8.35, suggesting a potential upside of 33.74%. Given Southwestern Energy’s higher possible upside, analysts plainly believe Southwestern Energy is more favorable than Antero Resources.

Volatility & Risk

Antero Resources has a beta of 3.4, meaning that its stock price is 240% more volatile than the S&P 500. Comparatively, Southwestern Energy has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500.

Summary

Antero Resources beats Southwestern Energy on 9 of the 15 factors compared between the two stocks.

About Antero Resources

Antero Resources Corporation, an independent oil and natural gas company, engages in the development, production, exploration, and acquisition of natural gas, natural gas liquids (NGLs), and oil properties in the United States. It operates in three segments: Exploration and Development; Marketing; and Equity Method Investment in Antero Midstream. As of December 31, 2023, the company had approximately 515,000 net acres in the Appalachian Basin; and approximately 172,000 net acres in the Upper Devonian Shale. Its gathering and compression systems also comprise 631 miles of gas gathering pipelines in the Appalachian Basin. The company was formerly known as Antero Resources Appalachian Corporation and changed its name to Antero Resources Corporation in June 2013. Antero Resources Corporation was incorporated in 2002 and is headquartered in Denver, Colorado.

About Southwestern Energy

Southwestern Energy Company, an independent energy company, engages in the exploration, development, and production of natural gas, oil, and natural gas liquids (NGLs) in the United States. It operates through two segments, Exploration and Production, and Marketing. The company focuses on the development of unconventional natural gas and oil reservoirs located in Pennsylvania, West Virginia, Ohio, and Louisiana. It also engages in the marketing and transportation of natural gas, oil, and NGLs. It serves LNG exporters, energy companies, utilities, and industrial purchasers of natural gas. Southwestern Energy Company was incorporated in 1929 and is headquartered in Spring, Texas.