Contrasting Parker Drilling Company (PKD) & Nabors Industries (NBR)
Parker Drilling Company (NYSE: PKD) and Nabors Industries (NYSE:NBR) are both oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, institutional ownership, profitabiliy and analyst recommendations.
Volatility & Risk
Parker Drilling Company has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Nabors Industries has a beta of 1.56, indicating that its stock price is 56% more volatile than the S&P 500.
Valuation & Earnings
This table compares Parker Drilling Company and Nabors Industries’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Parker Drilling Company||$394.77 million||0.43||$23.86 million||($1.39)||-0.94|
|Nabors Industries||$2.19 billion||0.97||$562.51 million||($2.74)||-2.70|
Nabors Industries has higher revenue and earnings than Parker Drilling Company. Nabors Industries is trading at a lower price-to-earnings ratio than Parker Drilling Company, indicating that it is currently the more affordable of the two stocks.
Nabors Industries pays an annual dividend of $0.24 per share and has a dividend yield of 3.2%. Parker Drilling Company does not pay a dividend. Nabors Industries pays out -8.8% of its earnings in the form of a dividend. Parker Drilling Company has raised its dividend for 3 consecutive years.
This table compares Parker Drilling Company and Nabors Industries’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Parker Drilling Company||-44.28%||-43.74%||-14.55%|
This is a summary of recent ratings and target prices for Parker Drilling Company and Nabors Industries, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Parker Drilling Company||0||2||5||0||2.71|
Parker Drilling Company presently has a consensus price target of $3.13, indicating a potential upside of 140.38%. Nabors Industries has a consensus price target of $15.25, indicating a potential upside of 106.08%. Given Parker Drilling Company’s stronger consensus rating and higher possible upside, research analysts clearly believe Parker Drilling Company is more favorable than Nabors Industries.
Insider and Institutional Ownership
66.4% of Parker Drilling Company shares are held by institutional investors. Comparatively, 98.7% of Nabors Industries shares are held by institutional investors. 3.6% of Parker Drilling Company shares are held by company insiders. Comparatively, 4.1% of Nabors Industries shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Nabors Industries beats Parker Drilling Company on 12 of the 16 factors compared between the two stocks.
Parker Drilling Company Company Profile
Parker Drilling Company (Parker Drilling) is a provider of contract drilling, and drilling-related services and rental tools and services. The Company’s business consists of two business lines: drilling services and rental tools services. Its Rental Tools Services business includes U.S. Rental Tools and International Rental Tools segments, and its Drilling Services business includes its U.S. (Lower 48) Drilling, and International & Alaska Drilling segments. In its Drilling Services business, the Company drills oil and gas wells for customers in both the United States and international markets. In its Rental Tools Services business, the Company provides rental equipment and services to exploration and production (E&P) companies, drilling contractors and service companies on land and offshore in the United States and select international markets. As of December 31, 2016, the Company had operations in 20 countries.
Nabors Industries Company Profile
Nabors Industries Ltd. owns and operates a land-based drilling rig fleet. The Company is a provider of offshore platform drilling rigs in the United States and multiple international markets. The Company conducts its Drilling & Rig Services business through four segments: U.S. Drilling, Canada Drilling, International Drilling and Rig Services. The Company provides wellbore placement services, drilling software and performance tools, drilling equipment and various technologies throughout the oil and gas markets. The Company’s Drilling & Rig Services business comprises land-based and offshore drilling rig operations and other rig services, consisting of equipment manufacturing, rig instrumentation and optimization software. The Company is a provider of directional drilling and measurement while drilling (MWD) systems and services. The Company also provides drilling technology and equipment, and well-site services.
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