Financial Contrast: Ocean Rig UDW (ORIG) & Precision Drilling (PDS)
Ocean Rig UDW (NASDAQ: ORIG) and Precision Drilling (NYSE:PDS) are both oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.
Insider and Institutional Ownership
81.7% of Ocean Rig UDW shares are owned by institutional investors. Comparatively, 49.2% of Precision Drilling shares are owned by institutional investors. 1.0% of Precision Drilling shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This table compares Ocean Rig UDW and Precision Drilling’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ocean Rig UDW||N/A||N/A||N/A|
This is a breakdown of recent ratings and recommmendations for Ocean Rig UDW and Precision Drilling, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ocean Rig UDW||0||1||2||0||2.67|
Ocean Rig UDW currently has a consensus price target of $30.00, indicating a potential upside of 5.04%. Precision Drilling has a consensus price target of $4.45, indicating a potential upside of 29.74%. Given Precision Drilling’s higher probable upside, analysts clearly believe Precision Drilling is more favorable than Ocean Rig UDW.
Volatility and Risk
Ocean Rig UDW has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500. Comparatively, Precision Drilling has a beta of 1.84, indicating that its stock price is 84% more volatile than the S&P 500.
Earnings and Valuation
This table compares Ocean Rig UDW and Precision Drilling’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Ocean Rig UDW||$1.01 billion||2.58||-$5.40 million||N/A||N/A|
|Precision Drilling||$1.04 billion||0.97||-$101.85 million||($0.28)||-12.25|
Ocean Rig UDW has higher earnings, but lower revenue than Precision Drilling.
About Ocean Rig UDW
Ocean Rig UDW Inc., an offshore drilling contractor, provides oilfield services for offshore oil and gas exploration, development, and production drilling worldwide. It specializes in the ultra-deepwater and harsh-environment segment of the offshore drilling industry. The company owns and operates two fifth generation harsh weather ultra-deepwater semisubmersible offshore drilling units under the Leiv Eiriksson and Eirik Raude names; five sixth generation ultra-deepwater drilling units under the Ocean Rig Corcovado, the Ocean Rig Olympia, the Ocean Rig Poseidon, and the Ocean Rig Mykonos names; and four seventh generation drilling units under the Ocean Rig Mylos, the Ocean Rig Skyros, the Ocean Rig Athena, and the Ocean Rig Apollo names. It serves oil companies, integrated oil and gas companies, state-owned national oil companies, and independent oil and gas companies. The company is based in George Town, the Cayman Islands.
About Precision Drilling
Precision Drilling Corporation provides oil and natural gas drilling and related services and products. The company operates in two segments, Contract Drilling Services, and Completion and Production Services. The Contract Drilling Services segment offers onshore well drilling services to exploration and production companies in the oil and natural gas industry. This segment's services include land drilling, directional drilling, and turnkey drilling; and procurement and distribution of oilfield supplies, as well as manufacture and refurbishment of drilling and service rig equipment. As of December 31, 2016, this segment operated 255 land drilling rigs, including 135 in Canada; 103 in the United States; 5 in Mexico; 4 in Saudi Arabia; 5 in Kuwait; 2 in the Kurdistan region of Iraq; and 1 in the country of Georgia. The Completion and Production Services segment offers completion and workover services, and ancillary services to oil and natural gas exploration and production companies. It provides service rigs for well completion, workover, abandonment, maintenance, and re-entry preparation services; snubbing units for pressure control services; camp and catering services; and water system services. This segment also engages in the rental of oilfield surface equipment, and wellsite accommodations. This segment operated 196 well completion and workover service rigs, and 11 snubbing units in Canada and the United States; approximately 2,200 oilfield rental items, including surface storage, small-flow wastewater treatment, and power generation and solids control equipment; and 132 wellsite accommodation units in Canada. It also had 43 drilling camps and 4 base camps in Canada; and 10 large-flow wastewater treatment units, 24 pump houses, and 8 potable water production units in Canada. Precision Drilling Corporation was founded in 1951 and is headquartered in Calgary, Canada.
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