Head to Head Analysis: Seadrill (NYSE:SDRL) & Noble (NYSE:NE)

Seadrill (NYSE:SDRL) and Noble (NYSE:NE) are both mid-cap energy companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, dividends, risk, valuation, profitability, analyst recommendations and institutional ownership.

Volatility and Risk

Seadrill has a beta of 1.31, suggesting that its stock price is 31% more volatile than the S&P 500. Comparatively, Noble has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.

Earnings & Valuation

This table compares Seadrill and Noble”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Seadrill	$1.44 billion	2.00	-$77.00 million	($1.24)	-37.14
Noble	$3.29 billion	2.31	$216.72 million	$1.35	35.31

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

Insider and Institutional Ownership

95.7% of Seadrill shares are held by institutional investors. Comparatively, 68.1% of Noble shares are held by institutional investors. 0.2% of Seadrill shares are held by company insiders. Comparatively, 1.5% of Noble shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Seadrill	2	3	2	1	2.25
Noble	1	10	1	0	2.00

Seadrill presently has a consensus target price of $48.00, indicating a potential upside of 4.23%. Noble has a consensus target price of $39.25, indicating a potential downside of 17.66%. Given Seadrill’s stronger consensus rating and higher probable upside, research analysts clearly believe Seadrill is more favorable than Noble.

Profitability

This table compares Seadrill and Noble’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Seadrill	-5.36%	-2.07%	-1.48%
Noble	6.60%	2.34%	1.40%

Summary

Noble beats Seadrill on 9 of the 15 factors compared between the two stocks.

About Seadrill

Seadrill Ltd. engages in the provision of offshore drilling services to the oil and gas industry. It operates through the following segments: Floaters, Jack-up rigs, and Other. The Floaters segment encompasses drilling, completion, and maintenance of offshore exploration and production wells. the Jack-up Rigs segment includes drilling contracts relate to jack-up rigs for operations in harsh and benign environments in shallow water. The Other segment represents management services to third parties and related parties. The company was founded on May 10, 2005 and is headquartered in Hamilton, Bermuda.

About Noble

Noble Corp. Plc engages in the provision offshore drilling services for oil and gas industry. It focuses on a balanced fleet of floating and jackup rigs and the deployment of drilling rigs in oil and gas basins around the world. The company was founded by Lloyd Noble and Art Olson in 1921 and is headquartered in London, the United Kingdom.