Critical Analysis: Deep Down (DPDW) & Weatherford International PLC (WFT)

Deep Down (OTCMKTS: DPDW) and Weatherford International PLC (NYSE:WFT) are both oils/energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.

Insider and Institutional Ownership

6.0% of Deep Down shares are owned by institutional investors. 1.2% of Weatherford International PLC shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Deep Down and Weatherford International PLC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Deep Down 6.51% 7.27% 6.26%
Weatherford International PLC -53.49% -65.33% -10.11%

Risk & Volatility

Deep Down has a beta of -0.1, indicating that its share price is 110% less volatile than the S&P 500. Comparatively, Weatherford International PLC has a beta of 2.45, indicating that its share price is 145% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Deep Down and Weatherford International PLC, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Deep Down 0 0 0 0 N/A
Weatherford International PLC 1 6 18 0 2.68

Weatherford International PLC has a consensus price target of $6.15, suggesting a potential upside of 91.64%. Given Weatherford International PLC’s higher possible upside, analysts plainly believe Weatherford International PLC is more favorable than Deep Down.

Valuation and Earnings

This table compares Deep Down and Weatherford International PLC’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Deep Down $26.05 million 0.51 $3.07 million $0.10 8.80
Weatherford International PLC $5.51 billion 0.58 -$256.00 million ($3.19) -1.01

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

Deep Down Company Profile

Deep Down, Inc. is engaged in the oilfield services industry. The Company operates through Deep Down Delaware segment. The Company is a provider of specialized services to the offshore energy industry to support deep water and ultra-deep water exploration, development and production of oil and gas, and other maritime operations. It also produces custom engineered products that assist it in fulfilling service objectives for specific projects on a contractual basis. The Company designs and manufactures deep water and ultra-deep water, surface and offshore equipment solutions, which are used by independent and foreign national oil and gas companies in offshore areas across the world. The Company provides engineering and management services, including the design, installation and retrieval of subsea equipment and systems, connection and termination operations, well-commissioning services, as well as construction support and remotely operated vehicle (ROV) operations support.

Weatherford International PLC Company Profile

Weatherford International Ltd. (Weatherford) is one of the largest multinational oilfield service companies providing innovative solutions, technology and services to the oil and gas industry. The Company operates in over 90 countries and has a network of approximately 860 locations, including manufacturing, service, research and development, and training facilities and employs approximately 29,500 people.

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