Analyzing Weatherford International (NASDAQ:WFRD) & Vantage Drilling (OTCMKTS:VTGDF)

Vantage Drilling (OTCMKTS:VTGDF) and Weatherford International (NASDAQ:WFRD) are both energy companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, risk, institutional ownership, profitability and valuation.

Profitability

This table compares Vantage Drilling and Weatherford International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vantage Drilling	38.80%	-9.97%	-6.50%
Weatherford International	7.66%	21.50%	7.09%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Vantage Drilling and Weatherford International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vantage Drilling	0	0	0	0	0.00
Weatherford International	1	2	8	0	2.64

Weatherford International has a consensus target price of $113.56, indicating a potential upside of 22.00%. Given Weatherford International’s stronger consensus rating and higher possible upside, analysts plainly believe Weatherford International is more favorable than Vantage Drilling.

Institutional and Insider Ownership

97.2% of Weatherford International shares are owned by institutional investors. 7.5% of Vantage Drilling shares are owned by company insiders. Comparatively, 2.1% of Weatherford International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Vantage Drilling and Weatherford International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vantage Drilling	$138.25 million	N/A	$40.34 million	$4.40	0.00
Weatherford International	$4.92 billion	1.36	$431.00 million	$5.07	18.36

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

Volatility and Risk

Vantage Drilling has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500. Comparatively, Weatherford International has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500.

Summary

Weatherford International beats Vantage Drilling on 11 of the 13 factors compared between the two stocks.

About Vantage Drilling

Vantage Drilling Company is in liquidation. Previously, the company was engaged in the provision of offshore contract drilling services for multinational oil and natural gas companies, government owned oil and natural gas companies, and independent oil and natural gas producers in the United States and internationally. Vantage Drilling Company was founded in 2007 and is based in Houston, Texas.

About Weatherford International

Weatherford International plc, an energy services company, provides equipment and services for the drilling, evaluation, completion, production, and intervention of oil, geothermal, and natural gas wells worldwide. The company operates through three segments: Drilling and Evaluation; Well Construction and Completions; and Production and Intervention. It offers artificial lift systems, including reciprocating rod, progressing cavity pumping, gas, hydraulic, plunger, and hybrid lift systems, as well as related automation and control systems; pressure pumping and reservoir stimulation services, such as acidizing, fracturing, cementing, and coiled-tubing intervention; and software, automation and flow measurement solutions. The company also provides safety, downhole reservoir monitoring, flow control, and multistage fracturing systems, as well as sand-control technologies, and production and isolation packers; liner hangers to suspend a casing string in high-temperature and high-pressure wells; cementing products, including plugs, float and stage equipment, and torque-and-drag reduction technology for zonal isolation; and pre-job planning and installation services. In addition, it offers directional drilling services, and logging and measurement services while drilling; services related to rotary-steerable systems, high temperature and high pressure sensors, drilling reamers, and circulation subs; rotating control devices and advanced automated control systems, as well as closed loop drilling, air drilling, managed-pressure drilling, and underbalanced drilling services; open-hole and cased-hole logging services; and intervention and remediation services. Further, it provides tubular handling, management, and connection services; and re-entry, fishing, and well abandonment services, as well as patented bottom hole, tubular-handling equipment, pressure-control equipment, and drill pipe and collars. The company was incorporated in 1972 and is based in Houston, Texas.