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 earnings, analyst recommendations, dividends, institutional ownership, valuation, profitability and risk.

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%

Volatility & Risk

North Atlantic Drilling has a beta of 3, indicating that its share price is 200% more volatile than the S&P 500. Comparatively, Noble Corporation has a beta of 2.28, indicating that its share price is 128% more volatile than the S&P 500.

Valuation and Earnings

This table compares North Atlantic Drilling and Noble Corporation’s 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 0.67 $639.70 million ($7.21) -0.53

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.

Analyst Ratings

This is a summary of recent recommendations and price targets 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 price target of $5.65, indicating a potential upside of 48.36%. Given Noble Corporation’s higher possible upside, analysts plainly believe Noble Corporation is more favorable than North Atlantic Drilling.

Institutional & 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 insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments 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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