Ocean Rig UDW (NASDAQ: ORIG) and SandRidge Energy (NYSE:SD) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, profitabiliy, dividends, institutional ownership, valuation, analyst recommendations and risk.

Valuation and Earnings

This table compares Ocean Rig UDW and SandRidge Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ocean Rig UDW N/A N/A N/A ($40.71) 0.00
SandRidge Energy $390.07 million 1.65 $185.62 million N/A N/A

SandRidge Energy has higher revenue and earnings than Ocean Rig UDW.

Profitability

This table compares Ocean Rig UDW and SandRidge Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ocean Rig UDW -195.64% 16.32% 5.96%
SandRidge Energy N/A N/A N/A

Insider & Institutional Ownership

12.8% of Ocean Rig UDW shares are owned by institutional investors. Comparatively, 20.4% of SandRidge Energy shares are owned by institutional investors. 3.6% of SandRidge Energy shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Ocean Rig UDW and SandRidge Energy, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ocean Rig UDW 0 1 0 0 2.00
SandRidge Energy 0 1 1 0 2.50

Ocean Rig UDW currently has a consensus target price of $1.00, suggesting a potential upside of 400.50%. SandRidge Energy has a consensus target price of $21.00, suggesting a potential upside of 10.94%. Given Ocean Rig UDW’s higher probable upside, analysts clearly believe Ocean Rig UDW is more favorable than SandRidge Energy.

Summary

SandRidge Energy beats Ocean Rig UDW on 6 of the 9 factors compared between the two stocks.

Ocean Rig UDW Company Profile

Ocean Rig UDW Inc is a Cyprus-based offshore drilling contractor that provides oilfield services for oil and gas exploration, development and production drilling, and specializes in the ultra-deepwater and harsh-environment segment of the drilling industry. The Company owns and operates approximately 13 offshore ultra deepwater drilling units, comprising of ultra deepwater semisubmersible drilling rigs and ultra deepwater drill-ships. The Company’s drilling units include Leiv Eiriksson, Ocean Rig Corcovado, Ocean Rig Poseidon, Ocean Rig Mykonos, Ocean Rig Mylos, Ocean Rig Skyros and Ocean Rig Athena. In addition, the Company, through its wholly owned subsidiary, provides supervisory management services including onshore management to its operating drilling units and drilling units under construction.

SandRidge Energy Company Profile

SandRidge Energy, Inc. is an oil and natural gas company. The Company is engaged in the exploration, development and production of crude oil, natural gas and natural gas liquids. It operates through two segments: exploration and production, which is engaged in the exploration and production of oil and natural gas properties and includes its proportionate share of the activities of the SandRidge Mississippian Trust I, SandRidge Mississippian Trust II and SandRidge Permian Trust (the Royalty Trusts), and midstream services, which coordinates the delivery of electricity to its exploration and production operations in the Mid-Continent. It focuses on exploration and production activities in the Mid-Continent and Rockies regions of the United States. It owns and operates additional interests in west Texas. It also operates businesses and infrastructure systems, including a saltwater gathering and disposal system, and an electrical transmission system.

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