IRIS International (NASDAQ: IRIS) and Eco-Stim Energy Solutions (NASDAQ:ESES) are both small-cap oils/energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, risk, institutional ownership, earnings and analyst recommendations.

Valuation and Earnings

This table compares IRIS International and Eco-Stim Energy Solutions’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
IRIS International $47.70 million 0.82 -$24.80 million ($2.49) -1.30
Eco-Stim Energy Solutions $15.27 million 7.55 -$12.68 million ($1.34) -1.16

Eco-Stim Energy Solutions has higher revenue, but lower earnings than IRIS International. IRIS International is trading at a lower price-to-earnings ratio than Eco-Stim Energy Solutions, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

68.9% of IRIS International shares are held by institutional investors. Comparatively, 50.0% of Eco-Stim Energy Solutions shares are held by institutional investors. 9.7% of IRIS International shares are held by company insiders. Comparatively, 11.1% of Eco-Stim Energy Solutions shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and target prices for IRIS International and Eco-Stim Energy Solutions, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
IRIS International 0 0 0 0 N/A
Eco-Stim Energy Solutions 0 1 2 0 2.67

Eco-Stim Energy Solutions has a consensus price target of $2.10, suggesting a potential upside of 35.48%. Given Eco-Stim Energy Solutions’ higher probable upside, analysts clearly believe Eco-Stim Energy Solutions is more favorable than IRIS International.

Profitability

This table compares IRIS International and Eco-Stim Energy Solutions’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
IRIS International -61.58% -36.70% -29.47%
Eco-Stim Energy Solutions -134.72% -69.12% -28.55%

Risk & Volatility

IRIS International has a beta of 1.37, indicating that its stock price is 37% more volatile than the S&P 500. Comparatively, Eco-Stim Energy Solutions has a beta of 2.19, indicating that its stock price is 119% more volatile than the S&P 500.

Summary

Eco-Stim Energy Solutions beats IRIS International on 8 of the 12 factors compared between the two stocks.

IRIS International Company Profile

Mitcham Industries, Inc. is a provider of equipment to the geophysical, oceanographic and hydrographic industries. The Company operates through two segments. The Equipment Leasing segment is primarily engaged in the leasing of seismic equipment to companies in the oil and gas industry across the world. The Equipment Manufacturing and Sales segment is engaged in the design, production and sale of marine seismic equipment, and oceanographic and hydrographic equipment. Its leasing business includes Mitcham Canada ULC, Seismic Asia Pacific Pty Ltd., Mitcham Seismic Eurasia LLC, Mitcham Europe Ltd. and Mitcham Marine Leasing Pte. Ltd. The Equipment Manufacturing and Sales Segment includes its Seamap International Holdings Pte, Ltd. (Seamap) business and Klein Marine Systems, Inc. (Klein). Seamap designs, manufactures and sells a range of products for the seismic, hydrographic and offshore industries. Klein develops and manufactures high performance side scan sonar systems.

Eco-Stim Energy Solutions Company Profile

Eco-Stim Energy Solutions, Inc. is an oilfield services company. The Company provides well stimulation, coiled tubing and field management services to the upstream oil and gas industry. The Company focuses on the active shale and unconventional oil and natural gas basins outside the United States and it has commenced operations in Argentina. The Company operates well stimulation fleets, coiled tubing units and other downhole completion equipment, as well as provides sweet spot analysis in shale resource basins using geophysical predictive modeling combined with real-time feedback from down-hole diagnostic tools. The Company offers a pumping fleet, including well-stimulation pumps, nitrogen pumping units and cranes, in both trailer-mounted and skid-mounted configurations. It provides a range of pressure-pumping services, including work-over pumping, well injection and wireline pump downs.

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