Baytex Energy (NASDAQ: PTEN) and Patterson-UTI Energy (NASDAQ:PTEN) are both oils/energy companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, risk, valuation, institutional ownership, earnings and profitability.

Analyst Recommendations

This is a breakdown of recent ratings for Baytex Energy and Patterson-UTI Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Baytex Energy 1 1 9 0 2.73
Patterson-UTI Energy 0 3 17 0 2.85

Baytex Energy currently has a consensus price target of $5.00, suggesting a potential upside of 74.83%. Patterson-UTI Energy has a consensus price target of $24.47, suggesting a potential upside of 41.84%. Given Baytex Energy’s higher probable upside, research analysts plainly believe Baytex Energy is more favorable than Patterson-UTI Energy.

Dividends

Patterson-UTI Energy pays an annual dividend of $0.16 per share and has a dividend yield of 0.9%. Baytex Energy does not pay a dividend. Patterson-UTI Energy pays out -20.0% of its earnings in the form of a dividend.

Risk & Volatility

Baytex Energy has a beta of 3.1, suggesting that its share price is 210% more volatile than the S&P 500. Comparatively, Patterson-UTI Energy has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500.

Valuation and Earnings

This table compares Baytex Energy and Patterson-UTI Energy’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Baytex Energy $1.42 billion 0.48 $67.24 million ($0.02) -143.00
Patterson-UTI Energy $2.36 billion 1.61 $5.91 million ($0.80) -21.56

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

Profitability

This table compares Baytex Energy and Patterson-UTI Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Baytex Energy -0.55% -8.23% -3.55%
Patterson-UTI Energy 3.72% -2.64% -1.75%

Insider & Institutional Ownership

29.7% of Baytex Energy shares are owned by institutional investors. Comparatively, 96.3% of Patterson-UTI Energy shares are owned by institutional investors. 3.7% of Patterson-UTI Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

Patterson-UTI Energy beats Baytex Energy on 12 of the 16 factors compared between the two stocks.

Baytex Energy Company Profile

Baytex Energy Corp., an oil and gas company, engages in the acquisition, development, and production of oil and natural gas in the Western Canadian Sedimentary Basin and in the Eagle Ford in the United States. It offers heavy oil, heavy gravity crude oil, bitumen, light oil, and natural gas liquids. Its primary oil resource plays include the Eagle Ford in Texas, and the Peace River Oil Sands and Lloydminster heavy oil projects in North America. The company provides 612 million barrels of oil equivalent; bitumen in low estimate to 1,181 million barrels of oil equivalent; and bitumen in the high estimate to 798 million barrels of oil equivalent. Baytex Energy Corp. was founded in 1993 and is headquartered in Calgary, Canada.

Patterson-UTI Energy Company Profile

Patterson-UTI Energy, Inc., through its subsidiaries, provides onshore contract drilling services to oil and natural gas operators in the United States and Canada. It operates through two segments, Contract Drilling and Pressure Pumping. The Contract Drilling segment markets its contract drilling services primarily in Texas, southeastern New Mexico, northern Louisiana, Colorado, Wyoming, North Dakota, western Oklahoma, Pennsylvania, Ohio, West Virginia, and western Canada. As of December 31, 2017, this segment had a drilling fleet of 295 marketable land-based drilling rigs. The Pressure Pumping segment offers pressure pumping services that consist of well stimulation and cementing for the completion of new wells and remedial work on existing wells, as well as hydraulic fracturing, nitrogen, cementing, and acid pumping services in Texas, the Mid-Continent, and the Appalachian region. Patterson-UTI Energy, Inc. also manufactures and sells pipe handling components and related technology to drilling contractors in North America and other markets; and owns and invests in oil and natural gas assets as a non-operating working interest owner located principally in Texas and New Mexico. Patterson-UTI Energy, Inc. was founded in 1978 and is headquartered in Houston, Texas.

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