Transocean Partners (RIGP) and Helmerich & Payne (NYSE:HP) Financial Analysis

Helmerich & Payne (NYSE: HP) and Transocean Partners (NYSE:RIGP) are both energy companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Insider & Institutional Ownership

29.0% of Transocean Partners shares are held by institutional investors. 4.2% of Helmerich & Payne shares are held by insiders. Comparatively, 0.1% of Transocean Partners shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations for Helmerich & Payne and Transocean Partners, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Helmerich & Payne 6 15 3 0 1.88
Transocean Partners 0 0 0 0 N/A

Helmerich & Payne presently has a consensus target price of $54.00, indicating a potential downside of 22.90%. Given Helmerich & Payne’s higher probable upside, analysts clearly believe Helmerich & Payne is more favorable than Transocean Partners.

Valuation and Earnings

This table compares Helmerich & Payne and Transocean Partners’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Helmerich & Payne $1.80 billion 4.22 -$128.21 million ($1.19) -58.86
Transocean Partners N/A N/A N/A $2.41 7.40

Transocean Partners has lower revenue, but higher earnings than Helmerich & Payne. Helmerich & Payne is trading at a lower price-to-earnings ratio than Transocean Partners, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Helmerich & Payne and Transocean Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Helmerich & Payne -7.16% -2.96% -1.95%
Transocean Partners 53.12% 13.03% 15.28%

Dividends

Helmerich & Payne pays an annual dividend of $2.80 per share and has a dividend yield of 4.0%. Transocean Partners pays an annual dividend of $1.45 per share and has a dividend yield of 8.1%. Helmerich & Payne pays out -235.3% of its earnings in the form of a dividend. Transocean Partners pays out 60.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Helmerich & Payne has raised its dividend for 45 consecutive years and Transocean Partners has raised its dividend for 3 consecutive years.

Summary

Transocean Partners beats Helmerich & Payne on 7 of the 13 factors compared between the two stocks.

Helmerich & Payne Company Profile

Helmerich & Payne, Inc. is engaged in contract drilling of oil and gas wells for others. The Company operates in the contract drilling industry. The Company’s contract drilling business consists of three segments: U.S. Land, Offshore and International Land. The Company is also engaged in the ownership, development and operation of commercial real estate and the research and development of rotary steerable technology. Its real estate investments are located within Tulsa, Oklahoma, and include a shopping center containing approximately 441,000 leasable square feet, multi-tenant industrial warehouse properties containing approximately one million leasable square feet and approximately 210 acres of undeveloped real estate. The Company provides drilling rigs, equipment, personnel and camps on a contract basis. The Company’s subsidiaries include Helmerich & Payne International Drilling Co. and Helmerich & Payne de Venezuela, C.A.

Transocean Partners Company Profile

Transocean Partners LLC a limited liability company. The Company is formed by Transocean Partners Holdings Limited and a subsidiary of Transocean Ltd. (Transocean), to own, operate and acquire advanced offshore drilling rigs. The Company’s assets consist of over 50% ownership interest in each of the entities that owns and operates over three ultra-deepwater drilling rigs that are operating in the U.S. Gulf of Mexico, which include Discoverer Clear Leader, Discoverer Inspiration and Development Driller III. The Company owns or has partial ownership interests in, and operated over 60 mobile offshore drilling units, including approximately 30 ultra-deepwater floaters, over seven harsh environment floaters, approximately five deepwater floaters, over 10 midwater floaters and approximately 10 high-specification jackups. Transocean also has approximately six ultra-deepwater drillships and over five high-specification jackups under construction.

Receive News & Ratings for Helmerich & Payne Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Helmerich & Payne and related companies with MarketBeat.com's FREE daily email newsletter.

Leave a Reply