Independence Contract Drilling (NYSE: DO) and Diamond Offshore Drilling (NYSE:DO) are both oils/energy companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.
Risk and Volatility
Independence Contract Drilling has a beta of 2.63, indicating that its stock price is 163% more volatile than the S&P 500. Comparatively, Diamond Offshore Drilling has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500.
Earnings & Valuation
This table compares Independence Contract Drilling and Diamond Offshore Drilling’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Independence Contract Drilling||$90.01 million||1.83||-$24.29 million||($0.53)||-8.15|
|Diamond Offshore Drilling||$1.49 billion||1.66||$18.34 million||$0.82||21.90|
Diamond Offshore Drilling has higher revenue and earnings than Independence Contract Drilling. Independence Contract Drilling is trading at a lower price-to-earnings ratio than Diamond Offshore Drilling, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings and recommmendations for Independence Contract Drilling and Diamond Offshore Drilling, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Independence Contract Drilling||0||1||4||0||2.80|
|Diamond Offshore Drilling||8||7||1||0||1.56|
Independence Contract Drilling currently has a consensus target price of $6.38, suggesting a potential upside of 47.57%. Diamond Offshore Drilling has a consensus target price of $15.85, suggesting a potential downside of 11.77%. Given Independence Contract Drilling’s stronger consensus rating and higher possible upside, research analysts clearly believe Independence Contract Drilling is more favorable than Diamond Offshore Drilling.
This table compares Independence Contract Drilling and Diamond Offshore Drilling’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Independence Contract Drilling||-19.21%||-7.34%||-5.63%|
|Diamond Offshore Drilling||-5.57%||-1.06%||-0.64%|
Insider & Institutional Ownership
75.8% of Independence Contract Drilling shares are owned by institutional investors. 12.6% of Independence Contract Drilling shares are owned by company insiders. Comparatively, 0.0% of Diamond Offshore Drilling shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
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 pad-optimal ShaleDriller rigs that are engineered and designed to optimize the development of various oil and natural gas properties in the Permian Basin. Its fleet consists of 14 rigs. The company was founded in 2011 and is headquartered in Houston, Texas.
About Diamond Offshore Drilling
Diamond Offshore Drilling, Inc. provides contract drilling services to the energy industry worldwide. It provides services in floater market, including ultra-deepwater, deepwater, and mid-water. The company operates a fleet of 17 offshore drilling rigs, which comprises 4 drillships, 7 ultra-deepwater, 4 deepwater, and 2 mid-water semisubmersibles. It serves independent oil and gas companies, and government-owned oil companies. The company was founded in 1989 and is headquartered in Houston, Texas. Diamond Offshore Drilling, Inc. is a subsidiary of Loews Corporation.
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