Helmerich & Payne (NYSE: HP) and Seadrill (NASDAQ:SDRL) are both oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.

Valuation & Earnings

This table compares Helmerich & Payne and Seadrill’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Helmerich & Payne $1.60 billion 3.47 $373.98 million ($1.67) -30.62
Seadrill $2.37 billion 0.08 $1.15 billion N/A N/A

Seadrill has higher revenue and earnings than Helmerich & Payne.

Dividends

Helmerich & Payne pays an annual dividend of $2.80 per share and has a dividend yield of 5.5%. Seadrill does not pay a dividend. Helmerich & Payne pays out -167.7% of its earnings in the form of a dividend. Seadrill has increased its dividend for 44 consecutive years.

Analyst Ratings

This is a breakdown of recent recommendations for Helmerich & Payne and Seadrill, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Helmerich & Payne 8 11 3 0 1.77
Seadrill 1 0 0 0 1.00

Helmerich & Payne currently has a consensus target price of $54.63, indicating a potential upside of 6.83%. Given Helmerich & Payne’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Helmerich & Payne is more favorable than Seadrill.

Profitability

This table compares Helmerich & Payne and Seadrill’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Helmerich & Payne -11.19% -3.37% -2.24%
Seadrill -27.38% -6.03% -3.02%

Summary

Helmerich & Payne beats Seadrill on 9 of the 12 factors compared between the two stocks.

Helmerich & Payne Company Profile

Helmerich & Payne, Inc. is engaged in contract drilling of oil and gas wells for others. The Company operates in the contract drilling industry. The Company’s contract drilling business consists of three segments: U.S. Land, Offshore and International Land. The Company is also engaged in the ownership, development and operation of commercial real estate and the research and development of rotary steerable technology. Its real estate investments are located within Tulsa, Oklahoma, and include a shopping center containing approximately 441,000 leasable square feet, multi-tenant industrial warehouse properties containing approximately one million leasable square feet and approximately 210 acres of undeveloped real estate. The Company provides drilling rigs, equipment, personnel and camps on a contract basis. The Company’s subsidiaries include Helmerich & Payne International Drilling Co. and Helmerich & Payne de Venezuela, C.A.

Seadrill Company Profile

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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