Pioneer Energy Services Corp. (NYSE: PES) and Seadrill (NASDAQ:SDRL) are both small-cap oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, valuation and risk.

Institutional & Insider Ownership

79.4% of Pioneer Energy Services Corp. shares are held by institutional investors. 6.1% of Pioneer Energy Services Corp. shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Pioneer Energy Services Corp. and Seadrill, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pioneer Energy Services Corp. 0 4 6 0 2.60
Seadrill 5 1 0 0 1.17

Pioneer Energy Services Corp. presently has a consensus target price of $5.53, indicating a potential upside of 198.99%. Seadrill has a consensus target price of $3.50, indicating a potential upside of 1,150.00%. Given Seadrill’s higher probable upside, analysts plainly believe Seadrill is more favorable than Pioneer Energy Services Corp..

Profitability

This table compares Pioneer Energy Services Corp. and Seadrill’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pioneer Energy Services Corp. -33.86% -28.63% -10.36%
Seadrill 10.02% 2.69% 1.06%

Earnings & Valuation

This table compares Pioneer Energy Services Corp. and Seadrill’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Pioneer Energy Services Corp. $342.72 million 0.42 $20.01 million ($1.65) -1.12
Seadrill $2.65 billion 0.05 $1.44 billion N/A N/A

Seadrill has higher revenue and earnings than Pioneer Energy Services Corp..

Summary

Seadrill beats Pioneer Energy Services Corp. on 6 of the 11 factors compared between the two stocks.

About Pioneer Energy Services Corp.

Pioneer Energy Services Corp. provides land-based drilling services and production services to a group of independent oil and gas exploration and production companies in the United States and internationally in Colombia. The Company operates through two segments, which include drilling services segment and production services segment. It also provides two of its services (coiled tubing and wireline services) offshore in the Gulf of Mexico. Its drilling services segment provides contract land drilling services to a group of exploration and production companies through the Company’s four drilling divisions in the United States, and internationally in Colombia. Its production services segment provides a range of services to a group of exploration and production companies, with its operations concentrated in the various United States onshore oil and gas producing regions in the Mid-Continent and Rocky Mountain states and in the Gulf Coast.

About Seadrill

Seadrill Limited is an offshore drilling contractor providing offshore drilling services to the oil and gas industry. The Company’s primary business is the ownership and operation of drillships, semi-submersible rigs and jack-up rigs for operations in shallow-, mid-, deep-, and ultra deepwater areas, and in benign and harsh environments. The Company’s segments are Floaters and Jack-ups. The Company offers services encompassing drilling, completion and maintenance of offshore exploration and production wells. The Company contracts its drilling units primarily on a dayrate basis to drill wells for its customers. The Company has a fleet of approximately 38 offshore drilling units consisting of over 12 semi-submersible rigs, approximately seven drillships and over 19 jack-up rigs in operation, and contracts for the construction of approximately 13 offshore drilling units. The Company also provides management services to certain unconsolidated companies in which its holds investments.

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