Solaris Oilfield Infra (SOI) & National Oilwell Varco (NOV) Critical Review

Solaris Oilfield Infra (NYSE: SOI) and National Oilwell Varco (NYSE:NOV) are both oils/energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, analyst recommendations, dividends, earnings and profitability.

Profitability

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This table compares Solaris Oilfield Infra and National Oilwell Varco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Solaris Oilfield Infra 12.50% 11.07% 9.77%
National Oilwell Varco -3.24% -1.10% -0.75%

Analyst Ratings

This is a summary of current ratings and recommmendations for Solaris Oilfield Infra and National Oilwell Varco, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Solaris Oilfield Infra 0 1 13 0 2.93
National Oilwell Varco 3 17 4 0 2.04

Solaris Oilfield Infra currently has a consensus price target of $19.23, indicating a potential upside of 8.02%. National Oilwell Varco has a consensus price target of $36.48, indicating a potential downside of 4.71%. Given Solaris Oilfield Infra’s stronger consensus rating and higher possible upside, research analysts plainly believe Solaris Oilfield Infra is more favorable than National Oilwell Varco.

Insider & Institutional Ownership

65.4% of Solaris Oilfield Infra shares are owned by institutional investors. Comparatively, 93.5% of National Oilwell Varco shares are owned by institutional investors. 14.4% of Solaris Oilfield Infra shares are owned by insiders. Comparatively, 0.8% of National Oilwell Varco 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.

Valuation & Earnings

This table compares Solaris Oilfield Infra and National Oilwell Varco’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Solaris Oilfield Infra $67.39 million 12.17 $7.30 million $0.48 37.08
National Oilwell Varco $7.30 billion 1.99 -$237.00 million ($0.42) -91.14

Solaris Oilfield Infra has higher earnings, but lower revenue than National Oilwell Varco. National Oilwell Varco is trading at a lower price-to-earnings ratio than Solaris Oilfield Infra, indicating that it is currently the more affordable of the two stocks.

Dividends

National Oilwell Varco pays an annual dividend of $0.20 per share and has a dividend yield of 0.5%. Solaris Oilfield Infra does not pay a dividend. National Oilwell Varco pays out -47.6% of its earnings in the form of a dividend.

Summary

Solaris Oilfield Infra beats National Oilwell Varco on 11 of the 15 factors compared between the two stocks.

Solaris Oilfield Infra Company Profile

Solaris Oilfield Infrastructure, Inc. manufactures and sells patented mobile proppant management systems to unload, store, and deliver proppant at oil and natural gas well sites in the United States. The company's systems are designed for transferring large quantities of proppant to the well sites. It also provides real-time inventory management solutions for proppant mining, rail shipping, and transloading operations. The company serves oil and natural gas exploration and production, as well as oilfield service companies. Solaris Oilfield Infrastructure, Inc. was founded in 2014 and is based in Houston, Texas.

National Oilwell Varco Company Profile

National Oilwell Varco, Inc. designs, manufactures, and sells systems and components used in oil and gas drilling and production; and provides oilfield services to the upstream oil and gas industry worldwide. It operates through three segments: Wellbore Technologies, Completion & Production Solutions, and Rig Technologies. The Wellbore Technologies segment designs, manufactures, rents, and sells various equipment and technologies. This segment also provides solids control and waste management equipment and services, drilling and completion fluids, data acquisition and analytics, water management solutions, managed-pressure-drilling systems, and wellsite logistics solutions; tubular inspection, repair and coating, rope access inspection, and instrumentation services; and power generation equipment, drill and wired pipes, instruments, measuring and monitoring equipment, downhole and fishing tools, hole openers, and drill bits The Completion & Production Solutions segment designs, manufactures, and sells pumping trucks, blenders, sanders, hydration units, injection units, flowline, and manifolds; coiled tubing units, coiled tubing, and wireline units and tools; composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems; and floating production systems and subsea production technologies. The Rig Technologies segment offers land rigs; offshore drilling equipment packages; and drilling rig components It provides substructures, derricks, and masts; cranes; pipe lifting, racking, rotating, and assembly systems; fluid transfer technologies, such as mud pumps; pressure control equipment, including blowout preventers; power transmission systems comprising drives and generators; and rig instrumentation and control systems. This segment also offers spare parts; and repair and rental services, as well as remote equipment monitoring, technical support, field, and training services. The company was founded in 1862 and is based in Houston, Texas.

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