Franks International (FI) & Archrock Partners (NASDAQ:APLP) Critical Review

Archrock Partners (NASDAQ: APLP) and Franks International (NYSE:FI) are both small-cap oils/energy companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, valuation, profitability, dividends, risk and analyst recommendations.

Dividends

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Archrock Partners pays an annual dividend of $1.14 per share and has a dividend yield of 9.1%. Franks International pays an annual dividend of $0.15 per share and has a dividend yield of 2.7%. Archrock Partners pays out 422.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Franks International pays out -24.6% of its earnings in the form of a dividend.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Archrock Partners and Franks International, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Archrock Partners 0 5 1 0 2.17
Franks International 3 8 2 0 1.92

Archrock Partners presently has a consensus price target of $16.63, indicating a potential upside of 32.15%. Franks International has a consensus price target of $7.56, indicating a potential upside of 37.12%. Given Franks International’s higher possible upside, analysts clearly believe Franks International is more favorable than Archrock Partners.

Volatility & Risk

Archrock Partners has a beta of 2, suggesting that its share price is 100% more volatile than the S&P 500. Comparatively, Franks International has a beta of 1.22, suggesting that its share price is 22% more volatile than the S&P 500.

Profitability

This table compares Archrock Partners and Franks International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Archrock Partners -0.08% 3.74% 0.99%
Franks International -35.06% -11.22% -9.62%

Valuation & Earnings

This table compares Archrock Partners and Franks International’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Archrock Partners $557.50 million 1.62 -$420,000.00 $0.27 46.59
Franks International $454.80 million 2.71 -$159.45 million ($0.61) -9.03

Archrock Partners has higher revenue and earnings than Franks International. Franks International is trading at a lower price-to-earnings ratio than Archrock Partners, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

45.3% of Archrock Partners shares are held by institutional investors. Comparatively, 33.2% of Franks International shares are held by institutional investors. 0.4% of Archrock Partners shares are held by insiders. Comparatively, 77.9% of Franks International shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Archrock Partners beats Franks International on 11 of the 16 factors compared between the two stocks.

Archrock Partners Company Profile

Archrock Partners, L.P., together with its subsidiaries, provides natural gas contract operations services to customers in the United States. The company's contract operations services primarily include designing, sourcing, owning, installing, operating, servicing, repairing, and maintaining equipment to provide natural gas compression services to its customers. It serves companies engaged in various aspects of the oil and natural gas industry, including oil and natural gas producers, processors, gatherers, transporters, and storage providers. The company markets its services through sales and field service personnel. Archrock General Partner, L.P. operates as the general partner of the company. The company was formerly known as Exterran Partners, L.P. and changed its name to Archrock Partners, L.P. in November 2015. Archrock Partners, L.P. was founded in 2006 and is based in Houston, Texas.

Franks International Company Profile

Frank’s International N.V. (FINV) is a provider of engineered tubular services, tubular fabrication and specialty well construction and well intervention solutions to the oil and gas industry. The Company operates through four business segments: International Services, U. S. Services, Tubular Sales and Blackhawk. As of December 31, 2016, the International Services segment provided tubular services in international offshore markets and in several onshore international regions in approximately 60 countries on six continents. The U.S. Services segment provides tubular services. The Blackhawk segment provides well construction and well intervention rental equipment, services and products, in addition to the cementing tool expertise, in the United States and Mexican Gulf of Mexico, onshore United States and other select international locations.

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