North Atlantic Drilling (NYSE: NADL) and Noble Corporation (NYSE:NE) are both small-cap oils/energy companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, earnings, risk and dividends.

Risk & Volatility

North Atlantic Drilling has a beta of 3, indicating that its stock price is 200% more volatile than the S&P 500. Comparatively, Noble Corporation has a beta of 2.18, indicating that its stock price is 118% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for North Atlantic Drilling and Noble Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
North Atlantic Drilling 0 0 0 0 N/A
Noble Corporation 6 17 4 0 1.93

Noble Corporation has a consensus target price of $5.80, suggesting a potential upside of 25.98%. Given Noble Corporation’s higher probable upside, analysts clearly believe Noble Corporation is more favorable than North Atlantic Drilling.

Valuation & Earnings

This table compares North Atlantic Drilling and Noble Corporation’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
North Atlantic Drilling $343.90 million 0.08 $157.90 million ($7.96) -0.14
Noble Corporation $1.40 billion 0.80 $639.70 million ($7.21) -0.64

Noble Corporation has higher revenue and earnings than North Atlantic Drilling. Noble Corporation is trading at a lower price-to-earnings ratio than North Atlantic Drilling, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares North Atlantic Drilling and Noble Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
North Atlantic Drilling -54.37% -55.80% -6.69%
Noble Corporation -122.04% -3.19% -1.83%

Institutional and Insider Ownership

5.7% of North Atlantic Drilling shares are owned by institutional investors. Comparatively, 95.6% of Noble Corporation shares are owned by institutional investors. 1.6% of Noble Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Noble Corporation beats North Atlantic Drilling on 10 of the 12 factors compared between the two stocks.

North Atlantic Drilling Company Profile

North Atlantic Drilling Ltd. operates as an offshore drilling contractor in the North Atlantic region. The company provides harsh environment offshore drilling services to the oil and gas industry primarily in Norway, the United Kingdom, and the Russian Federation. As of December 31, 2016, it owned seven offshore drilling rigs, including three semi-submersibles, one ultra-deep water drillship, and three jack-up rigs. The company was founded in 2011 and is headquartered in Hamilton, Bermuda. North Atlantic Drilling Ltd. is a subsidiary of Seadrill Limited.

Noble Corporation Company Profile

Noble Corporation is an offshore drilling contractor for the oil and gas industry. The Company performs contract drilling services with its fleet of 79 mobile offshore drilling units and one floating production storage and offloading unit (NYSE:NE) located globally.

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