Analyzing Helmerich & Payne (HP) and Pacific Drilling SA (PACD)
Helmerich & Payne (NYSE: HP) and Pacific Drilling SA (NYSE:PACD) are both oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, institutional ownership and risk.
This is a summary of recent ratings and price targets for Helmerich & Payne and Pacific Drilling SA, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Helmerich & Payne||8||12||3||0||1.78|
|Pacific Drilling SA||0||0||0||0||N/A|
Helmerich & Payne currently has a consensus target price of $53.95, suggesting a potential downside of 1.75%. Given Helmerich & Payne’s higher possible upside, equities analysts clearly believe Helmerich & Payne is more favorable than Pacific Drilling SA.
Helmerich & Payne pays an annual dividend of $2.80 per share and has a dividend yield of 5.1%. Pacific Drilling SA does not pay a dividend. Helmerich & Payne pays out -167.7% of its earnings in the form of a dividend. Pacific Drilling SA has increased its dividend for 44 consecutive years.
Volatility & Risk
Helmerich & Payne has a beta of 1.26, suggesting that its share price is 26% more volatile than the S&P 500. Comparatively, Pacific Drilling SA has a beta of 2.65, suggesting that its share price is 165% more volatile than the S&P 500.
This table compares Helmerich & Payne and Pacific Drilling SA’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%|
|Pacific Drilling SA||-205.84%||-22.13%||-9.74%|
Institutional & Insider Ownership
6.4% of Pacific Drilling SA shares are owned by institutional investors. 3.9% of Helmerich & Payne shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares Helmerich & Payne and Pacific Drilling SA’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Helmerich & Payne||$1.62 billion||3.67||-$56.82 million||($1.67)||-32.88|
|Pacific Drilling SA||N/A||N/A||N/A||($13.19)||-0.03|
Pacific Drilling SA has higher revenue, but lower earnings than Helmerich & Payne. Helmerich & Payne is trading at a lower price-to-earnings ratio than Pacific Drilling SA, indicating that it is currently the more affordable of the two stocks.
Helmerich & Payne beats Pacific Drilling SA on 10 of the 13 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.
Pacific Drilling SA Company Profile
Pacific Drilling S.A. is an international offshore drilling contractor. The Company provides offshore drilling services to the oil and natural gas industry through the use of high-specification rigs. The Company’s primary business is to contract its high-specification rigs, related equipment and work crews, primarily on a day rate basis, to drill wells for its clients. The Company is engaged in drillships segment. The Company focuses on the high-specification segment of the floating rig market. The Company considers high-specification requirements to include rigs in water depths of approximately 7,500 feet or projects requiring advanced operating capabilities, such as hook-loads (>800 tons), accommodations (over 200 beds), mud storage and pumping capacity, and deck-load and space capabilities. The Company’s contract drillships operate in the deepwater regions of the United States, Gulf of Mexico and Nigeria.
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