Halliburton (NYSE: HAL) and Matrix Service (NASDAQ:MTRX) are both oils/energy companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, earnings, valuation, dividends, profitability, risk and analyst recommendations.

Volatility & Risk

Halliburton has a beta of 1.09, suggesting that its share price is 9% more volatile than the S&P 500. Comparatively, Matrix Service has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Halliburton and Matrix Service, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Halliburton 0 2 24 0 2.92
Matrix Service 0 3 0 0 2.00

Halliburton currently has a consensus price target of $57.05, suggesting a potential upside of 34.45%. Given Halliburton’s stronger consensus rating and higher probable upside, analysts plainly believe Halliburton is more favorable than Matrix Service.

Dividends

Halliburton pays an annual dividend of $0.72 per share and has a dividend yield of 1.7%. Matrix Service does not pay a dividend. Halliburton pays out 300.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Halliburton and Matrix Service’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Halliburton 1.13% 6.93% 2.47%
Matrix Service -0.02% -0.06% -0.03%

Institutional and Insider Ownership

79.3% of Halliburton shares are owned by institutional investors. Comparatively, 85.3% of Matrix Service shares are owned by institutional investors. 0.5% of Halliburton shares are owned by company insiders. Comparatively, 2.5% of Matrix Service shares are owned 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.

Earnings and Valuation

This table compares Halliburton and Matrix Service’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Halliburton $17.09 billion 2.16 $2.51 billion $0.24 176.80
Matrix Service $1.20 billion 0.31 $27.56 million ($0.01) -1,388.61

Halliburton has higher revenue and earnings than Matrix Service. Matrix Service is trading at a lower price-to-earnings ratio than Halliburton, indicating that it is currently the more affordable of the two stocks.

Summary

Halliburton beats Matrix Service on 12 of the 15 factors compared between the two stocks.

About Halliburton

Halliburton Company provides services and products to the upstream oil and natural gas industry throughout the lifecycle of the reservoir, from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the field. It operates through two segments: the Completion and Production segment, and the Drilling and Evaluation segment. The Completion and Production segment delivers cementing, stimulation, intervention, pressure control, specialty chemicals, artificial lift and completion services. The Drilling and Evaluation segment provides field and reservoir modeling, drilling, evaluation and wellbore placement solutions that enable customers to model, measure, drill and optimize their well construction activities. It serves national and independent oil and natural gas companies. As of December 31, 2016, it had conducted business in approximately 70 countries around the world.

About Matrix Service

Matrix Service Company provides engineering, fabrication, infrastructure, construction and maintenance services primarily to the oil, gas, power, petrochemical, industrial, mining and minerals markets. The Company’s segments include Electrical Infrastructure, Oil Gas & Chemical, Storage Solutions and Industrial. The Electrical Infrastructure segment primarily includes construction and maintenance services to a range of power generation facilities, such as combined cycle plants, natural gas fired power stations and renewable energy installations. The Oil Gas & Chemical segment includes turnaround activities, plant maintenance services and construction in the downstream petroleum industry. The Storage Solutions segment includes new construction of crude and refined products aboveground storage tanks (ASTs), as well as planned and emergency maintenance services. The Industrial segment includes construction and maintenance work in the iron and steel and mining and minerals industries.

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