Analyzing Ensco Plc (ESV) & Pioneer Energy Services Corp. (PES)

Ensco Plc (NYSE: ESV) and Pioneer Energy Services Corp. (NYSE:PES) are both small-cap oils/energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, dividends, institutional ownership, analyst recommendations, profitability and earnings.

Dividends

Ensco Plc pays an annual dividend of $0.04 per share and has a dividend yield of 0.8%. Pioneer Energy Services Corp. does not pay a dividend. Ensco Plc pays out 23.5% of its earnings in the form of a dividend.

Profitability

This table compares Ensco Plc and Pioneer Energy Services Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ensco Plc 2.68% 0.77% 0.45%
Pioneer Energy Services Corp. -33.86% -28.63% -10.36%

Valuation & Earnings

This table compares Ensco Plc and Pioneer Energy Services Corp.’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ensco Plc $1.98 billion 0.82 $716.60 million $0.17 31.30
Pioneer Energy Services Corp. $342.72 million 0.47 $20.01 million ($1.65) -1.27

Ensco Plc has higher revenue and earnings than Pioneer Energy Services Corp.. Pioneer Energy Services Corp. is trading at a lower price-to-earnings ratio than Ensco Plc, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Ensco Plc has a beta of 1.75, indicating that its share price is 75% more volatile than the S&P 500. Comparatively, Pioneer Energy Services Corp. has a beta of 3.03, indicating that its share price is 203% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Ensco Plc and Pioneer Energy Services Corp., as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ensco Plc 3 6 10 0 2.37
Pioneer Energy Services Corp. 0 6 5 0 2.45

Ensco Plc currently has a consensus price target of $9.16, suggesting a potential upside of 72.11%. Pioneer Energy Services Corp. has a consensus price target of $5.25, suggesting a potential upside of 150.00%. Given Pioneer Energy Services Corp.’s stronger consensus rating and higher probable upside, analysts plainly believe Pioneer Energy Services Corp. is more favorable than Ensco Plc.

Institutional & Insider Ownership

91.6% of Ensco Plc shares are owned by institutional investors. Comparatively, 74.0% of Pioneer Energy Services Corp. shares are owned by institutional investors. 0.6% of Ensco Plc shares are owned by company insiders. Comparatively, 6.1% of Pioneer Energy Services Corp. shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Ensco Plc beats Pioneer Energy Services Corp. on 10 of the 15 factors compared between the two stocks.

Ensco Plc Company Profile

Ensco plc is an offshore contract drilling company. The Company provides offshore contract drilling services to the international oil and gas industry. Its segments include Floaters, Jackups and Other. The Floaters segment includes its drillships and semisubmersible rigs, and provides contract drilling. Other consists of management services on rigs owned by third parties. The Floaters and the Jackups segments provide contract drilling. It owned and operated an offshore drilling rig fleet of 57 rigs, including two rigs under construction, with drilling operations around the world, as of December 31, 2016. As of December 31, 2016, its rig fleet included eight drill ships, 10 dynamically positioned semisubmersible rigs, three moored semisubmersible rigs and 38 jackup rigs. As of December 31, 2016, of its 59 rigs, 25 were located in the Middle East, Africa and Asia Pacific, 16 were located in North and South America (including Brazil) and 18 were located in Europe and the Mediterranean.

Pioneer Energy Services Corp. Company Profile

Pioneer Energy Services Corp. provides land-based drilling services and production services to a group of independent oil and gas exploration and production companies in the United States and internationally in Colombia. The Company operates through two segments, which include drilling services segment and production services segment. It also provides two of its services (coiled tubing and wireline services) offshore in the Gulf of Mexico. Its drilling services segment provides contract land drilling services to a group of exploration and production companies through the Company’s four drilling divisions in the United States, and internationally in Colombia. Its production services segment provides a range of services to a group of exploration and production companies, with its operations concentrated in the various United States onshore oil and gas producing regions in the Mid-Continent and Rocky Mountain states and in the Gulf Coast.

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