Critical Review: Liberty Energy (NYSE:LBRT) versus Noble (NYSE:NE)

Noble (NYSE:NE) and Liberty Energy (NYSE:LBRT) are both mid-cap energy companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, valuation, dividends, institutional ownership and earnings.

Earnings and Valuation

This table compares Noble and Liberty Energy”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Noble	$3.29 billion	2.15	$216.72 million	$0.93	47.58
Liberty Energy	$4.01 billion	0.79	$147.87 million	$0.74	26.16

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

Dividends

Noble pays an annual dividend of $2.00 per share and has a dividend yield of 4.5%. Liberty Energy pays an annual dividend of $0.36 per share and has a dividend yield of 1.9%. Noble pays out 215.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Liberty Energy pays out 48.6% of its earnings in the form of a dividend. Liberty Energy has increased its dividend for 2 consecutive years.

Profitability

This table compares Noble and Liberty Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Noble	4.88%	1.93%	1.18%
Liberty Energy	2.92%	1.14%	0.57%

Insider and Institutional Ownership

68.1% of Noble shares are held by institutional investors. Comparatively, 98.2% of Liberty Energy shares are held by institutional investors. 1.5% of Noble shares are held by company insiders. Comparatively, 2.0% of Liberty Energy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Noble and Liberty Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Noble	1	5	2	1	2.33
Liberty Energy	0	6	7	0	2.54

Noble currently has a consensus target price of $44.71, indicating a potential upside of 1.06%. Liberty Energy has a consensus target price of $29.55, indicating a potential upside of 52.65%. Given Liberty Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Liberty Energy is more favorable than Noble.

Volatility & Risk

Noble has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500. Comparatively, Liberty Energy has a beta of 0.61, meaning that its share price is 39% less volatile than the S&P 500.

Summary

Noble beats Liberty Energy on 10 of the 18 factors compared between the two stocks.

About Noble

Noble Corp. Plc engages in the provision offshore drilling services for oil and gas industry. It focuses on a balanced fleet of floating and jackup rigs and the deployment of drilling rigs in oil and gas basins around the world. The company was founded by Lloyd Noble and Art Olson in 1921 and is headquartered in London, the United Kingdom.

About Liberty Energy

Liberty Energy Inc. provides hydraulic services and related technologies to onshore oil and natural gas exploration, and production companies in North America. The company offers hydraulic fracturing services, including complementary services, such as wireline services, proppant delivery solutions, field gas processing and treating, compressed natural gas (CNG) delivery, data analytics, related goods comprising sand mine operations, and technologies; and well site fueling and logistics. As of as of December 31, 2023, the company owned and operated a fleet of approximately 40 active hydraulic fracturing; and two sand mines in the Permian Basin. In addition, the company provides services primarily in the Permian Basin, the Williston Basin, the Eagle Ford Shale, the Haynesville Shale, the Appalachian Basin (Marcellus Shale and Utica Shale), the Western Canadian Sedimentary Basin, the Denver-Julesburg Basin (the DJ Basin), and the Anadarko Basin. Liberty Energy Inc. was formerly known as Liberty Oilfield Services Inc. and changed its name to Liberty Energy Inc. in April 2022. The company was founded in 2011 and is headquartered in Denver, Colorado.