Analyzing Western Energy Services (OTCMKTS:WEEEF) and Flotek Industries (NYSE:FTK)

Flotek Industries (NYSE:FTK) and Western Energy Services (OTCMKTS:WEEEF) are both small-cap energy companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, dividends, risk, institutional ownership, profitability, analyst recommendations and valuation.

Insider and Institutional Ownership

10.9% of Flotek Industries shares are held by institutional investors. 3.0% of Flotek Industries shares are held by insiders. Comparatively, 50.0% of Western Energy Services shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Flotek Industries and Western Energy Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flotek Industries	14.48%	22.62%	12.96%
Western Energy Services	-3.02%	-2.24%	-1.56%

Analyst Ratings

This is a summary of recent recommendations and price targets for Flotek Industries and Western Energy Services, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flotek Industries	0	1	2	1	3.00
Western Energy Services	0	0	0	0	0.00

Flotek Industries presently has a consensus target price of $19.50, suggesting a potential upside of 10.54%. Given Flotek Industries’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Flotek Industries is more favorable than Western Energy Services.

Valuation & Earnings

This table compares Flotek Industries and Western Energy Services”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flotek Industries	$187.02 million	2.84	$10.50 million	$0.89	19.82
Western Energy Services	$162.82 million	0.32	-$5.22 million	($0.14)	-11.00

Flotek Industries has higher revenue and earnings than Western Energy Services. Western Energy Services is trading at a lower price-to-earnings ratio than Flotek Industries, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Flotek Industries has a beta of 1.45, indicating that its share price is 45% more volatile than the S&P 500. Comparatively, Western Energy Services has a beta of 0.55, indicating that its share price is 45% less volatile than the S&P 500.

Summary

Flotek Industries beats Western Energy Services on 14 of the 15 factors compared between the two stocks.

About Flotek Industries

Flotek Industries, Inc. operates as a technology-driven green chemistry and data company that serves customers across industrial and commercial markets in the United States, the United Arab Emirates, and internationally. It operates through two segments: Chemistry Technologies (CT) and Data Analytics (DA). The CT segment designs, develops, manufactures, packages, distributes, delivers, and markets green specialty chemicals that enhance the profitability of hydrocarbon producers, as well as green specialty chemistries, and logistics and technology services. This segment primarily serves integrated oil and gas, oilfield services, independent oil and gas, national and state-owned oil, geothermal energy, solar energy, and alternative energy companies. The DA segment designs, develops, produces, sells, and supports equipment and services that create and provide valuable information on the composition and properties of energy customers' hydrocarbon fluids. It sells its products directly through a mix of in-house sales professionals, as well as contractual agency agreements. Flotek Industries, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.

About Western Energy Services

Western Energy Services Corp. operates as an oilfield service company in Canada and the United States. It operates through Contract Drilling and Production Services segments. The Contract Drilling segment provides contract drilling services using drilling rigs and auxiliary equipment. The Production Services segment offers well servicing rig and related equipment, as well as rental equipment services. Western Energy Services Corp. is headquartered in Calgary, Canada.