Financial Analysis: Geopark (GPRK) versus Independence Contract Drilling (ICD)
Geopark (NYSE: GPRK) and Independence Contract Drilling (NYSE:ICD) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, earnings, valuation, analyst recommendations, institutional ownership, profitability and dividends.
This is a summary of current recommendations and price targets for Geopark and Independence Contract Drilling, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Independence Contract Drilling||0||1||6||0||2.86|
Geopark presently has a consensus target price of $11.50, indicating a potential upside of 43.57%. Independence Contract Drilling has a consensus target price of $6.50, indicating a potential upside of 109.00%. Given Independence Contract Drilling’s higher probable upside, analysts clearly believe Independence Contract Drilling is more favorable than Geopark.
Earnings & Valuation
This table compares Geopark and Independence Contract Drilling’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Geopark||$252.12 million||1.91||$126.42 million||($0.65)||-12.32|
|Independence Contract Drilling||$73.97 million||1.58||$6.78 million||($0.81)||-3.84|
Geopark has higher revenue and earnings than Independence Contract Drilling. Geopark is trading at a lower price-to-earnings ratio than Independence Contract Drilling, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Geopark has a beta of 0.24, suggesting that its share price is 76% less volatile than the S&P 500. Comparatively, Independence Contract Drilling has a beta of 2.76, suggesting that its share price is 176% more volatile than the S&P 500.
This table compares Geopark and Independence Contract Drilling’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Independence Contract Drilling||-40.75%||-8.62%||-7.24%|
Institutional & Insider Ownership
14.0% of Geopark shares are owned by institutional investors. Comparatively, 80.8% of Independence Contract Drilling shares are owned by institutional investors. 11.8% of Independence Contract Drilling shares are owned by 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.
Geopark beats Independence Contract Drilling on 7 of the 13 factors compared between the two stocks.
GeoPark Limited engages in the exploration, development, and production of oil and gas reserves in Chile, Colombia, Brazil, Peru, and Argentina. As of December 31, 2016, the company had working and/or economic interests in 26 hydrocarbons blocks, as well as shallow-offshore concession in Brazil that includes the Manati Field. It had net proved reserves of 73.6 million barrels of oil equivalent. The company was formerly known as GeoPark Holdings Limited and changed its name to GeoPark Limited in July 2013. GeoPark Limited was founded in 2002 and is based in Santiago, Chile.
About Independence Contract Drilling
Independence Contract Drilling, Inc. provides land-based contract drilling services for oil and natural gas producers in the United States. The company constructs, owns, and operates a fleet of ShaleDriller rigs to optimize the development of various oil and gas properties in the Permian Basin. As of December 31, 2016, it had 12 rigs. The company was founded in 2011 and is headquartered in Houston, Texas.
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