Financial Analysis: Vantage Drilling (OTCMKTS:VTGDF) & Weatherford International (NASDAQ:WFRD)

Weatherford International (NASDAQ:WFRD) and Vantage Drilling (OTCMKTS:VTGDF) are both energy companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, profitability, valuation, analyst recommendations, dividends, earnings and risk.

Volatility and Risk

Weatherford International has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500. Comparatively, Vantage Drilling has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500.

Valuation & Earnings

This table compares Weatherford International and Vantage Drilling”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Weatherford International	$4.92 billion	1.36	$431.00 million	$5.07	18.36
Vantage Drilling	$138.25 million	N/A	$40.34 million	$4.40	0.00

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

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Weatherford International and Vantage Drilling, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Weatherford International	1	2	8	0	2.64
Vantage Drilling	0	0	0	0	0.00

Weatherford International presently has a consensus price target of $113.56, suggesting a potential upside of 22.00%. Given Weatherford International’s stronger consensus rating and higher probable upside, equities analysts plainly believe Weatherford International is more favorable than Vantage Drilling.

Insider and Institutional Ownership

97.2% of Weatherford International shares are held by institutional investors. 2.1% of Weatherford International shares are held by insiders. Comparatively, 7.5% of Vantage Drilling shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Weatherford International and Vantage Drilling’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Weatherford International	7.66%	21.50%	7.09%
Vantage Drilling	38.80%	-9.97%	-6.50%

Summary

Weatherford International beats Vantage Drilling on 11 of the 13 factors compared between the two stocks.

About Weatherford International

Weatherford International plc, an energy services company, provides equipment and services for the drilling, evaluation, completion, production, and intervention of oil, geothermal, and natural gas wells worldwide. The company operates through three segments: Drilling and Evaluation; Well Construction and Completions; and Production and Intervention. It offers artificial lift systems, including reciprocating rod, progressing cavity pumping, gas, hydraulic, plunger, and hybrid lift systems, as well as related automation and control systems; pressure pumping and reservoir stimulation services, such as acidizing, fracturing, cementing, and coiled-tubing intervention; and software, automation and flow measurement solutions. The company also provides safety, downhole reservoir monitoring, flow control, and multistage fracturing systems, as well as sand-control technologies, and production and isolation packers; liner hangers to suspend a casing string in high-temperature and high-pressure wells; cementing products, including plugs, float and stage equipment, and torque-and-drag reduction technology for zonal isolation; and pre-job planning and installation services. In addition, it offers directional drilling services, and logging and measurement services while drilling; services related to rotary-steerable systems, high temperature and high pressure sensors, drilling reamers, and circulation subs; rotating control devices and advanced automated control systems, as well as closed loop drilling, air drilling, managed-pressure drilling, and underbalanced drilling services; open-hole and cased-hole logging services; and intervention and remediation services. Further, it provides tubular handling, management, and connection services; and re-entry, fishing, and well abandonment services, as well as patented bottom hole, tubular-handling equipment, pressure-control equipment, and drill pipe and collars. The company was incorporated in 1972 and is based in Houston, 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.