Head-To-Head Survey: Precision Drilling (PDS) versus Parker Drilling (PKD)
Precision Drilling (NYSE: PDS) and Parker Drilling (NYSE:PKD) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, profitability, dividends, institutional ownership, risk and earnings.
Risk and Volatility
Precision Drilling has a beta of 1.74, meaning that its share price is 74% more volatile than the S&P 500. Comparatively, Parker Drilling has a beta of 1.51, meaning that its share price is 51% more volatile than the S&P 500.
This table compares Precision Drilling and Parker Drilling’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Insider and Institutional Ownership
49.2% of Precision Drilling shares are owned by institutional investors. Comparatively, 63.5% of Parker Drilling shares are owned by institutional investors. 1.0% of Precision Drilling shares are owned by insiders. Comparatively, 3.6% of Parker Drilling shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Precision Drilling and Parker Drilling’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Precision Drilling||$718.34 million||1.23||-$117.47 million||($0.30)||-10.07|
|Parker Drilling||$427.00 million||0.33||-$230.81 million||($1.08)||-0.93|
Precision Drilling has higher revenue and earnings than Parker Drilling. Precision Drilling is trading at a lower price-to-earnings ratio than Parker Drilling, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations and price targets for Precision Drilling and Parker Drilling, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Precision Drilling presently has a consensus target price of $5.04, suggesting a potential upside of 66.80%. Given Precision Drilling’s stronger consensus rating and higher probable upside, research analysts clearly believe Precision Drilling is more favorable than Parker Drilling.
Precision Drilling beats Parker Drilling on 12 of the 15 factors compared between the two stocks.
About Precision Drilling
Precision Drilling Corporation (Precision) is an oilfield services company. The Company provides onshore drilling and completion and production services to exploration and production companies in the oil and natural gas industry. The Company operates through two segments: Contract Drilling Services, and Completion and Production Services. The Contract Drilling Services segment operates its rigs in Canada, the United States and internationally. The Completion and Production Services segment provides completion and workover services and ancillary services to oil and natural gas exploration and production companies in Canada and the United States. As of December 31, 2016, the Contract Drilling Services segment consisted of 255 land drilling rigs, including 135 in Canada, 103 in the United States, five in Mexico, four in Saudi Arabia, five in Kuwait, two in the Kurdistan region of Iraq and one in the country of Georgia.
About Parker Drilling
Parker Drilling Company (Parker Drilling) is a provider of contract drilling, and drilling-related services and rental tools and services. The Company’s business consists of two business lines: drilling services and rental tools services. Its Rental Tools Services business includes U.S. Rental Tools and International Rental Tools segments, and its Drilling Services business includes its U.S. (Lower 48) Drilling, and International & Alaska Drilling segments. In its Drilling Services business, the Company drills oil and gas wells for customers in both the United States and international markets. In its Rental Tools Services business, the Company provides rental equipment and services to exploration and production (E&P) companies, drilling contractors and service companies on land and offshore in the United States and select international markets. As of December 31, 2016, the Company had operations in 20 countries.
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