Critical Survey: Vantage Drilling (OTCMKTS:VTGDF) and Kodiak Gas Services (NYSE:KGS)

Kodiak Gas Services (NYSE:KGS) and Vantage Drilling (OTCMKTS:VTGDF) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, dividends, profitability, institutional ownership, risk, analyst recommendations and valuation.

Profitability

This table compares Kodiak Gas Services and Vantage Drilling’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kodiak Gas Services	5.13%	13.12%	3.72%
Vantage Drilling	38.80%	-9.97%	-6.50%

Institutional & Insider Ownership

25.0% of Kodiak Gas Services shares are held by institutional investors. 0.6% of Kodiak Gas Services shares are held by company insiders. Comparatively, 7.5% of Vantage Drilling shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and target prices for Kodiak Gas Services and Vantage Drilling, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kodiak Gas Services	0	2	10	0	2.83
Vantage Drilling	0	0	0	0	0.00

Kodiak Gas Services presently has a consensus target price of $79.33, suggesting a potential upside of 35.14%. Given Kodiak Gas Services’ stronger consensus rating and higher probable upside, analysts plainly believe Kodiak Gas Services is more favorable than Vantage Drilling.

Volatility & Risk

Kodiak Gas Services has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500. Comparatively, Vantage Drilling has a beta of 0.45, meaning that its share price is 55% less volatile than the S&P 500.

Valuation and Earnings

This table compares Kodiak Gas Services and Vantage Drilling”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kodiak Gas Services	$1.32 billion	3.94	$80.52 million	$0.74	79.33
Vantage Drilling	$138.25 million	N/A	$40.34 million	$4.40	N/A

Kodiak Gas Services has higher revenue and earnings than Vantage Drilling. Vantage Drilling is trading at a lower price-to-earnings ratio than Kodiak Gas Services, indicating that it is currently the more affordable of the two stocks.

Summary

Kodiak Gas Services beats Vantage Drilling on 9 of the 12 factors compared between the two stocks.

About Kodiak Gas Services

Kodiak Gas Services, Inc. operates contract compression infrastructure for customers in the oil and gas industry in the United States. It operates in two segments, Compression Operations and Other Services. The Compression Operations segment operates company-owned and customer-owned compression infrastructure to enable the production, gathering, and transportation of natural gas and oil. The Other Services segment provides a range of contract services, including station construction, maintenance and overhaul, and other ancillary time and material-based offerings. The company was formerly known as Frontier TopCo, Inc. Kodiak Gas Services, Inc. was founded in 2010 and is headquartered in The Woodlands, Texas.

About Vantage Drilling

Vantage Drilling Company is in liquidation. Previously, the company was engaged in the provision of offshore contract drilling services for multinational oil and natural gas companies, government owned oil and natural gas companies, and independent oil and natural gas producers in the United States and internationally. Vantage Drilling Company was founded in 2007 and is based in Houston, Texas.