Critical Contrast: Pioneer Energy Services Corp. (PES) versus Patterson-UTI Energy (PTEN)

Pioneer Energy Services Corp. (NYSE: PES) and Patterson-UTI Energy (NASDAQ:PTEN) are both oils/energy companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, analyst recommendations, risk, institutional ownership, profitability and earnings.

Insider & Institutional Ownership

74.0% of Pioneer Energy Services Corp. shares are owned by institutional investors. Comparatively, 98.7% of Patterson-UTI Energy shares are owned by institutional investors. 6.1% of Pioneer Energy Services Corp. shares are owned by insiders. Comparatively, 4.6% of Patterson-UTI Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Patterson-UTI Energy pays an annual dividend of $0.08 per share and has a dividend yield of 0.4%. Pioneer Energy Services Corp. does not pay a dividend. Patterson-UTI Energy pays out -4.1% of its earnings in the form of a dividend.

Profitability

This table compares Pioneer Energy Services Corp. and Patterson-UTI Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pioneer Energy Services Corp. -33.86% -28.63% -10.36%
Patterson-UTI Energy -23.78% -10.03% -6.29%

Earnings & Valuation

This table compares Pioneer Energy Services Corp. and Patterson-UTI Energy’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Pioneer Energy Services Corp. $342.72 million 0.46 $20.01 million ($1.65) -1.24
Patterson-UTI Energy $1.34 billion 3.20 $260.21 million ($1.97) -10.27

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

Analyst Recommendations

This is a breakdown of recent ratings for Pioneer Energy Services Corp. and Patterson-UTI Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pioneer Energy Services Corp. 0 7 5 0 2.42
Patterson-UTI Energy 0 11 16 0 2.59

Pioneer Energy Services Corp. currently has a consensus target price of $5.25, indicating a potential upside of 156.10%. Patterson-UTI Energy has a consensus target price of $27.10, indicating a potential upside of 33.96%. Given Pioneer Energy Services Corp.’s higher possible upside, equities research analysts clearly believe Pioneer Energy Services Corp. is more favorable than Patterson-UTI Energy.

Risk & Volatility

Pioneer Energy Services Corp. has a beta of 3.03, indicating that its share price is 203% more volatile than the S&P 500. Comparatively, Patterson-UTI Energy has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500.

Summary

Patterson-UTI Energy beats Pioneer Energy Services Corp. on 11 of the 15 factors compared between the two stocks.

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.

Patterson-UTI Energy Company Profile

Patterson-UTI Energy, Inc. is an oilfield services company. The Company owns and operates a fleet of land-based drilling rigs and a fleet of pressure pumping equipment in the United States. The Company’s segments include Contract Drilling, Pressure Pumping and Other operations. The Contract Drilling segment markets its contract drilling services to independent and other oil and natural gas operators. As of December 31, 2016, the Company had 202 marketed land-based drilling rigs. The Pressure Pumping segment provides pressure pumping services to oil and natural gas operators primarily in Texas (Southwest Region) and the Appalachian region (Northeast Region). The Other operations segment includes the Company’s pipe handling components and related technology business, the oil and natural gas working interests and the Middle East/North Africa business. In addition, the Company owns and invests in oil and natural gas assets as a non-operating working interest owner in Texas and New Mexico.

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