McDermott International (MDR) & Matrix Service (MTRX) Critical Analysis
McDermott International (NYSE: MDR) and Matrix Service (NASDAQ:MTRX) are both oils/energy companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, valuation, profitability, analyst recommendations and risk.
Insider & Institutional Ownership
82.8% of McDermott International shares are owned by institutional investors. Comparatively, 81.7% of Matrix Service shares are owned by institutional investors. 1.3% of McDermott International shares are owned by insiders. Comparatively, 2.5% of Matrix Service shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for McDermott International and Matrix Service, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
McDermott International presently has a consensus target price of $7.93, suggesting a potential upside of 8.27%. Given McDermott International’s stronger consensus rating and higher possible upside, equities analysts plainly believe McDermott International is more favorable than Matrix Service.
This table compares McDermott International and Matrix Service’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
McDermott International has a beta of 1.32, suggesting that its stock price is 32% more volatile than the S&P 500. Comparatively, Matrix Service has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500.
Valuation and Earnings
This table compares McDermott International and Matrix Service’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|McDermott International||$2.64 billion||0.79||$34.11 million||$0.54||13.56|
|Matrix Service||$1.20 billion||0.39||-$180,000.00||($0.22)||-78.41|
McDermott International has higher revenue and earnings than Matrix Service. Matrix Service is trading at a lower price-to-earnings ratio than McDermott International, indicating that it is currently the more affordable of the two stocks.
McDermott International beats Matrix Service on 12 of the 13 factors compared between the two stocks.
McDermott International Company Profile
McDermott International, Inc. is a provider of integrated engineering, procurement, construction and installation (EPCI), front-end engineering and design (FEED) and module fabrication services for upstream field developments across the world. The Company delivers fixed and floating production facilities, pipeline installations and subsea systems from concept to commissioning for offshore and subsea oil and gas projects. It operates through three segments: the Americas, Europe and Africa (AEA), the Middle East (MEA) and Asia (ASA). As of December 31, 2016, operated in approximately 20 countries across the Americas, Europe, Africa, the Middle East, Asia and Australia, its integrated resources include a diversified fleet of marine vessels, fabrication facilities and engineering offices. It support its activities with project management and procurement services, while utilizing its fully integrated capabilities in both shallow water and deepwater construction.
Matrix Service Company Profile
Matrix Service Company provides engineering, fabrication, infrastructure, construction and maintenance services primarily to the oil, gas, power, petrochemical, industrial, mining and minerals markets. The Company’s segments include Electrical Infrastructure, Oil Gas & Chemical, Storage Solutions and Industrial. The Electrical Infrastructure segment primarily includes construction and maintenance services to a range of power generation facilities, such as combined cycle plants, natural gas fired power stations and renewable energy installations. The Oil Gas & Chemical segment includes turnaround activities, plant maintenance services and construction in the downstream petroleum industry. The Storage Solutions segment includes new construction of crude and refined products aboveground storage tanks (ASTs), as well as planned and emergency maintenance services. The Industrial segment includes construction and maintenance work in the iron and steel and mining and minerals industries.
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