Emerge Energy Services (NYSE: EMES) and Helix Energy Solutions Group (NYSE:HLX) are both small-cap oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, risk, earnings and dividends.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Emerge Energy Services and Helix Energy Solutions Group, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emerge Energy Services 0 2 4 0 2.67
Helix Energy Solutions Group 0 1 7 0 2.88

Emerge Energy Services presently has a consensus target price of $20.80, suggesting a potential upside of 237.66%. Helix Energy Solutions Group has a consensus target price of $10.50, suggesting a potential upside of 79.79%. Given Emerge Energy Services’ higher probable upside, analysts clearly believe Emerge Energy Services is more favorable than Helix Energy Solutions Group.

Volatility & Risk

Emerge Energy Services has a beta of 1.54, suggesting that its share price is 54% more volatile than the S&P 500. Comparatively, Helix Energy Solutions Group has a beta of 2.59, suggesting that its share price is 159% more volatile than the S&P 500.

Institutional & Insider Ownership

42.4% of Emerge Energy Services shares are held by institutional investors. Comparatively, 88.6% of Helix Energy Solutions Group shares are held by institutional investors. 5.7% of Helix Energy Solutions Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Emerge Energy Services and Helix Energy Solutions Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emerge Energy Services -14.29% -170.44% -25.17%
Helix Energy Solutions Group -12.09% -1.21% -0.71%

Earnings and Valuation

This table compares Emerge Energy Services and Helix Energy Solutions Group’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Emerge Energy Services $231.85 million 0.80 -$26.10 million ($1.14) -5.40
Helix Energy Solutions Group $544.13 million 1.59 $107.34 million ($0.51) -11.45

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

Summary

Helix Energy Solutions Group beats Emerge Energy Services on 12 of the 13 factors compared between the two stocks.

About Emerge Energy Services

Emerge Energy Services LP owns, operates, acquires and develops a portfolio of energy service assets. The Company operates through Sand segment. The Company conducts its Sand operations through its subsidiary, Superior Silica Sands LLC (SSS). The Company’s Sand business mines, processes and distributes silica sand, an input for the hydraulic fracturing of oil and gas wells. As of December 31, 2016, its Wisconsin facilities consisted of three dry plants located in Arland, Barron and New Auburn, Wisconsin, with a total permitted capacity of 6.3 million finished tons per year, and five wet plants and mine complexes. As of December 31, 2016, its dry plant in Kosse, Texas, had a capacity of 600,000 tons per year that is supplied by a separate mine and wet plant that processes local Texas sand. As of December 31, 2016, the Company also had 14 transload facilities located throughout North America in the basins where it delivers its sand, as well as a fleet of 5,573 railcars.

About Helix Energy Solutions Group

Helix Energy Solutions Group, Inc. is an international offshore energy services company. The Company provides services to the offshore energy industry, with a focus on well intervention and robotics operations. The Company operates in three segments: Well Intervention, Robotics and Production Facilities. Its Well Intervention segment includes the Company’s vessels and equipment used to perform well intervention services primarily in the Gulf of Mexico and North Sea regions. Its Robotics segment includes remotely operated vehicles (ROVs), trenchers and ROVDrills designed to complement offshore construction and well intervention services, and operates chartered ROV support vessels. Its Production Facilities segment includes the Helix Producer I (the HP I), a floating production vessel, the Helix Fast Response System (the HFRS), and its ownership interest in Independence Hub, LLC (Independence Hub).

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