TechnipFMC (NYSE:FTI) and Borr Drilling (NYSE:BORR) Critical Analysis

Borr Drilling (NYSE:BORR) and TechnipFMC (NYSE:FTI) are both energy companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.

Profitability

This table compares Borr Drilling and TechnipFMC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Borr Drilling	-23.98%	-5.95%	-1.84%
TechnipFMC	11.28%	36.54%	12.02%

Risk & Volatility

Borr Drilling has a beta of 1.08, indicating that its stock price is 8% more volatile than the S&P 500. Comparatively, TechnipFMC has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Borr Drilling and TechnipFMC, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Borr Drilling	2	1	0	2	2.40
TechnipFMC	0	3	12	0	2.80

Borr Drilling currently has a consensus price target of $5.27, suggesting a potential upside of 26.75%. TechnipFMC has a consensus price target of $72.08, suggesting a potential upside of 2.40%. Given Borr Drilling’s higher possible upside, equities analysts plainly believe Borr Drilling is more favorable than TechnipFMC.

Insider & Institutional Ownership

83.1% of Borr Drilling shares are held by institutional investors. Comparatively, 96.6% of TechnipFMC shares are held by institutional investors. 7.9% of Borr Drilling shares are held by insiders. Comparatively, 1.4% of TechnipFMC shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Borr Drilling and TechnipFMC”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Borr Drilling	$1.02 billion	1.28	$45.00 million	($0.78)	-5.33
TechnipFMC	$9.93 billion	2.78	$963.90 million	$2.88	24.44

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

Summary

TechnipFMC beats Borr Drilling on 11 of the 15 factors compared between the two stocks.

About Borr Drilling

Borr Drilling Limited operates as an offshore shallow-water drilling contractor to the oil and gas industry worldwide. The company owns, contracts, and operates jack-up drilling rigs for operations in shallow-water areas, including the provision of related equipment and work crews to conduct oil and gas drilling and workover operations for exploration and production. It serves oil and gas exploration and production companies, such as integrated oil companies, state-owned national oil companies, and independent oil and gas companies. The company was formerly known as Magni Drilling Limited and changed its name to Borr Drilling Limited in December 2016. Borr Drilling Limited was incorporated in 2016 and is based in Hamilton, Bermuda.

About TechnipFMC

TechnipFMC plc engages in the energy projects, technologies, and systems and services businesses in Europe, Central Asia, North America, Latin America, the Asia Pacific, Africa, the Middle East, and internationally. It operates through two segments: Subsea and Surface Technologies. The Subsea segment engages in the design, engineering, procurement, manufacturing, fabrication, installation, and life of field services for subsea systems, subsea field infrastructure, and subsea pipe systems used in oil and gas production and transportation. It provides subsea production and processing system; flexible pipe; subsea umbilicals, risers, and flowlines; vessels; robotics; well and asset services; and Subsea Studio for optimizing the development, execution, and operation of current and future subsea fields. The Surface Technologies segment designs, manufactures, and services products and systems used in land and shallow water exploration and production of crude oil and natural gas. This segment offers drilling; surface wellheads and production trees systems; iComplete, a pressure control system; fracturing tree and manifold systems; flexible pipes; safety and integrity systems, multiphase meter modules, in-line separation and processing systems, and standard pumps; well control and integrity systems; separation and processing systems; skid systems; and flow measurement and automation solutions. It also offers planning, testing and installation, commissioning, operations, replacement and upgrade, maintenance, storage, preservation, intervention, integrity, decommissioning, and abandonment; and supplies flowline products and services. TechnipFMC plc was founded in 1884 and is headquartered in Houston, Texas.