Archrock (NYSE:AROC) versus ProPetro (NYSE:PUMP) Head-To-Head Contrast

Archrock (NYSE:AROC) and ProPetro (NYSE:PUMP) are both energy companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, risk, analyst recommendations and valuation.

Risk and Volatility

Archrock has a beta of 1.11, suggesting that its share price is 11% more volatile than the S&P 500. Comparatively, ProPetro has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Archrock and ProPetro, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Archrock	0	1	6	0	2.86
ProPetro	0	3	2	0	2.40

Archrock currently has a consensus target price of $26.67, suggesting a potential upside of 6.94%. ProPetro has a consensus target price of $9.75, suggesting a potential upside of 48.74%. Given ProPetro’s higher probable upside, analysts clearly believe ProPetro is more favorable than Archrock.

Institutional & Insider Ownership

95.5% of Archrock shares are owned by institutional investors. Comparatively, 84.7% of ProPetro shares are owned by institutional investors. 2.6% of Archrock shares are owned by company insiders. Comparatively, 1.6% of ProPetro shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Archrock and ProPetro”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Archrock	$1.16 billion	3.81	$172.23 million	$1.18	21.13
ProPetro	$1.44 billion	0.47	-$137.86 million	($1.43)	-4.58

Archrock has higher earnings, but lower revenue than ProPetro. ProPetro is trading at a lower price-to-earnings ratio than Archrock, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Archrock and ProPetro’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Archrock	16.38%	18.31%	6.21%
ProPetro	-10.60%	2.16%	1.42%

Summary

Archrock beats ProPetro on 11 of the 14 factors compared between the two stocks.

About Archrock

Archrock, Inc., together with its subsidiaries, operates as an energy infrastructure company in the United States. The company operates in two segments, Contract Operations and Aftermarket Services. It engages in the designing, sourcing, owning, installing, operating, servicing, repairing, and maintaining of its owned fleet of natural gas compression equipment to provide natural gas compression services. The company also sells over-the-counter parts and components; and provides operations, major and routine maintenance, overhaul, and reconfiguration services to customers who own compression equipment. It serves integrated and independent oil and natural gas processors, gatherers, and transporters. The company was formerly known as Exterran Holdings, Inc. and changed its name to Archrock, Inc. in November 2015. Archrock, Inc. was founded in 1990 and is headquartered in Houston, Texas.

About ProPetro

ProPetro Holding Corp. operates as an integrated oilfield services company. The company provides hydraulic fracturing, wireline, cementing, and other complementary oilfield completion services to upstream oil and gas companies in the Permian Basin. ProPetro Holding Corp. was founded in 2007 and is headquartered in Midland, Texas.