Analyzing Baker Hughes (NASDAQ:BKR) and NCS Multistage (NASDAQ:NCSM)

NCS Multistage (NASDAQ:NCSM) and Baker Hughes (NASDAQ:BKR) are both energy companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Earnings and Valuation

This table compares NCS Multistage and Baker Hughes”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NCS Multistage	$162.56 million	0.63	$6.59 million	$4.54	8.90
Baker Hughes	$27.71 billion	1.61	$2.98 billion	$2.90	15.60

Baker Hughes has higher revenue and earnings than NCS Multistage. NCS Multistage is trading at a lower price-to-earnings ratio than Baker Hughes, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

NCS Multistage has a beta of 0.51, suggesting that its stock price is 49% less volatile than the S&P 500. Comparatively, Baker Hughes has a beta of 0.9, suggesting that its stock price is 10% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for NCS Multistage and Baker Hughes, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NCS Multistage	0	2	0	1	2.67
Baker Hughes	0	3	23	0	2.88

Baker Hughes has a consensus target price of $53.92, suggesting a potential upside of 19.15%. Given Baker Hughes’ stronger consensus rating and higher probable upside, analysts clearly believe Baker Hughes is more favorable than NCS Multistage.

Institutional & Insider Ownership

70.9% of NCS Multistage shares are held by institutional investors. Comparatively, 92.1% of Baker Hughes shares are held by institutional investors. 10.0% of NCS Multistage shares are held by insiders. Comparatively, 0.3% of Baker Hughes shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares NCS Multistage and Baker Hughes’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NCS Multistage	6.89%	12.10%	9.40%
Baker Hughes	10.43%	14.22%	6.49%

Summary

Baker Hughes beats NCS Multistage on 11 of the 15 factors compared between the two stocks.

About NCS Multistage

NCS Multistage Holdings, Inc. provides engineered products and support services for oil and natural gas well completions and construction, and field development strategies in the United States, Canada, and internationally. It offers fracturing systems, which include casing-installed sliding sleeves, downhole frac isolation assemblies, and sand jet perforating products; enhanced recovery products, such as sliding sleeve, as well as Terrus system, an injection control device; repeat precision products comprising composite frac plugs and bridge plugs, single-use disposable setting tools, express systems, and related products; chemical and radioactive tracer diagnostics services; and well construction products, including AirLock casing buoyancy system, Vecturon and Vectraset liner hanger systems, and Toe initiation sleeves. It offers its products and services primarily to exploration and production companies for use in onshore wells through technically-trained sales force, and operating partners or sales representatives. The company was formerly known as Pioneer Super Holdings, Inc. and changed its name to NCS Multistage Holdings, Inc. in December 2016. NCS Multistage Holdings, Inc. was founded in 2006 and is headquartered in Houston, Texas.

About Baker Hughes

Baker Hughes Company provides a portfolio of technologies and services to energy and industrial value chain worldwide. The company operates through Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET) segments. The OFSE segment designs and manufactures products and provides related services, including exploration, appraisal, development, production, rejuvenation, and decommissioning for onshore and offshore oilfield operations. This segment also provides drilling services, drill bits, and drilling and completions fluids; completions, intervention, measurements, pressure pumping, and wireline services; artificial lift systems, and oilfield and industrial chemicals; subsea projects and services, flexible pipe systems, and surface pressure control systems; and integrated well services and solutions. It serves oil and natural gas companies; the United States and international independent oil and natural gas companies; national or state-owned oil companies; engineering, procurement, and construction contractors; geothermal companies; and other oilfield service companies. The IET segment provides gas technology equipment, including drivers, driven equipment, flow control, and turnkey solutions for the mechanical-drive, compression, and power-generation applications; and energy sectors, such as oil and gas, LNG operations, petrochemical, and carbon solutions. This segment also provides rack-based vibration monitoring equipment and sensors; integrated asset performance management products; inspection services; pumps, valves, and gears; precision sensors and instrumentation, and condition monitoring solutions. It serves upstream, midstream, downstream, onshore, offshore, and small and large scale customers. The company was formerly known as Baker Hughes, a GE company and changed its name to Baker Hughes Company in October 2019. Baker Hughes Company was incorporated in 2016 and is based in Houston, Texas.