Newpark Resources (NYSE: NR) 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 companies based on the strength of their valuation, earnings, profitability, dividends, analyst recommendations, risk and institutional ownership.

Profitability

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

Net Margins Return on Equity Return on Assets
Newpark Resources 0.48% -0.29% -0.17%
Eco-Stim Energy Solutions -85.29% -43.11% -23.60%

Analyst Ratings

This is a breakdown of current recommendations for Newpark Resources and Eco-Stim Energy Solutions, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Newpark Resources 0 1 3 0 2.75
Eco-Stim Energy Solutions 0 1 4 0 2.80

Newpark Resources currently has a consensus target price of $10.00, indicating a potential upside of 21.95%. Eco-Stim Energy Solutions has a consensus target price of $2.36, indicating a potential upside of 65.03%. Given Eco-Stim Energy Solutions’ stronger consensus rating and higher probable upside, analysts clearly believe Eco-Stim Energy Solutions is more favorable than Newpark Resources.

Insider and Institutional Ownership

84.3% of Eco-Stim Energy Solutions shares are owned by institutional investors. 4.9% of Newpark Resources shares are owned by insiders. Comparatively, 11.1% of Eco-Stim Energy Solutions shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Risk and Volatility

Newpark Resources has a beta of 1.58, indicating that its share price is 58% more volatile than the S&P 500. Comparatively, Eco-Stim Energy Solutions has a beta of 2.95, indicating that its share price is 195% more volatile than the S&P 500.

Valuation & Earnings

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Newpark Resources $471.50 million 1.49 -$40.71 million $0.04 205.05
Eco-Stim Energy Solutions $8.35 million 12.77 -$17.92 million ($1.08) -1.32

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

Summary

Eco-Stim Energy Solutions beats Newpark Resources on 8 of the 13 factors compared between the two stocks.

Newpark Resources Company Profile

Newpark Resources, Inc. is a supplier providing products and services primarily to the oil and gas exploration and production (E&P) industry. The Company’s segments include Fluids Systems, and Mats and Integrated Services. The Fluids Systems segment provides drilling fluids products and technical services to customers in the North America; Europe, the Middle East and Africa; Latin America, and Asia Pacific regions. The Mats and Integrated Services segment provides composite mat rentals, as well as location construction and related site services, to customers at well, production, transportation and refinery locations in the United States. It manufactures and sells composite mats to customers outside of the United States, and to domestic customers outside of the oil and gas exploration market. The Fluids Systems segment offers customized solutions for technical drilling projects involving subsurface conditions, such as horizontal, directional, geologically deep or deep water drilling.

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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