Head-To-Head Review: Diamond Offshore Drilling (DO) vs. Patterson-UTI Energy (PTEN)
Diamond Offshore Drilling (NYSE: DO) and Patterson-UTI Energy (NASDAQ:PTEN) are both oils/energy companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, profitabiliy, earnings, analyst recommendations and dividends.
This is a breakdown of recent ratings and recommmendations for Diamond Offshore Drilling and Patterson-UTI Energy, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Diamond Offshore Drilling||8||12||2||0||1.73|
Diamond Offshore Drilling presently has a consensus price target of $15.64, suggesting a potential upside of 25.82%. Patterson-UTI Energy has a consensus price target of $26.96, suggesting a potential upside of 41.21%. Given Patterson-UTI Energy’s stronger consensus rating and higher probable upside, analysts plainly believe Patterson-UTI Energy is more favorable than Diamond Offshore Drilling.
Patterson-UTI Energy pays an annual dividend of $0.08 per share and has a dividend yield of 0.4%. Diamond Offshore Drilling does not pay a dividend. Patterson-UTI Energy pays out -4.1% of its earnings in the form of a dividend.
Insider & Institutional Ownership
85.1% of Patterson-UTI Energy shares are owned by institutional investors. 0.0% of Diamond Offshore Drilling shares are owned by insiders. Comparatively, 4.6% of Patterson-UTI Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility & Risk
Diamond Offshore Drilling has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500. Comparatively, Patterson-UTI Energy has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500.
Earnings and Valuation
This table compares Diamond Offshore Drilling and Patterson-UTI Energy’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Diamond Offshore Drilling||$1.48 billion||1.15||$660.47 million||$1.24||10.02|
|Patterson-UTI Energy||$1.34 billion||2.35||$205.64 million||($1.97)||-9.69|
Diamond Offshore Drilling has higher revenue and earnings than Patterson-UTI Energy. Patterson-UTI Energy is trading at a lower price-to-earnings ratio than Diamond Offshore Drilling, indicating that it is currently the more affordable of the two stocks.
This table compares Diamond Offshore Drilling and Patterson-UTI Energy’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Diamond Offshore Drilling||11.19%||5.77%||3.42%|
Patterson-UTI Energy beats Diamond Offshore Drilling on 8 of the 15 factors compared between the two stocks.
About Diamond Offshore Drilling
Diamond Offshore Drilling, Inc. provides contract drilling services to the energy industry. As of December 31, 2016, the Company had a fleet of 24 offshore drilling rigs. As of December 31, 2016, its fleet consisted of four drillships, 19 semisubmersible rigs and one jack-up rig. Its fleet enables it to offer a range of services, primarily in the floater market, including ultra-deepwater, deepwater and mid-water. The principal markets for its offshore contract drilling services are the Gulf of Mexico, including the United States and Mexico; South America, principally offshore Brazil, and Trinidad and Tobago; Australia and Southeast Asia, including Malaysia, Indonesia and Vietnam; Europe, principally offshore the United Kingdom and Norway; East and West Africa; the Mediterranean, and the Middle East. The Company provides offshore drilling services to a customer base that includes independent oil and gas companies, and government-owned oil companies.
About Patterson-UTI Energy
Patterson-UTI Energy, Inc. is an oilfield services company. The Company owns and operates a fleet of land-based drilling rigs and a fleet of pressure pumping equipment in the United States. The Company’s segments include Contract Drilling, Pressure Pumping and Other operations. The Contract Drilling segment markets its contract drilling services to independent and other oil and natural gas operators. As of December 31, 2016, the Company had 202 marketed land-based drilling rigs. The Pressure Pumping segment provides pressure pumping services to oil and natural gas operators primarily in Texas (Southwest Region) and the Appalachian region (Northeast Region). The Other operations segment includes the Company’s pipe handling components and related technology business, the oil and natural gas working interests and the Middle East/North Africa business. In addition, the Company owns and invests in oil and natural gas assets as a non-operating working interest owner in Texas and New Mexico.
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