Transocean (NASDAQ: ORIG) and Ocean Rig UDW (NASDAQ:ORIG) are both mid-cap oils/energy companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, institutional ownership, dividends, profitability and risk.
Volatility & Risk
Transocean has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Ocean Rig UDW has a beta of 1.57, indicating that its stock price is 57% more volatile than the S&P 500.
This table compares Transocean and Ocean Rig UDW’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ocean Rig UDW||-16.88%||6.37%||5.08%|
Valuation and Earnings
This table compares Transocean and Ocean Rig UDW’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Transocean||$2.97 billion||2.10||-$3.13 billion||($0.06)||-225.67|
|Ocean Rig UDW||$1.01 billion||3.06||-$5.40 million||N/A||N/A|
Ocean Rig UDW has lower revenue, but higher earnings than Transocean.
This is a breakdown of recent ratings for Transocean and Ocean Rig UDW, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ocean Rig UDW||0||1||2||0||2.67|
Transocean presently has a consensus target price of $13.43, indicating a potential downside of 0.79%. Ocean Rig UDW has a consensus target price of $30.00, indicating a potential downside of 11.32%. Given Transocean’s higher possible upside, research analysts plainly believe Transocean is more favorable than Ocean Rig UDW.
Insider & Institutional Ownership
70.7% of Transocean shares are held by institutional investors. Comparatively, 86.1% of Ocean Rig UDW shares are held by institutional investors. 0.3% of Transocean shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Ocean Rig UDW beats Transocean on 9 of the 13 factors compared between the two stocks.
Transocean Company Profile
Transocean Ltd., together with its subsidiaries, provides offshore contract drilling services for oil and gas wells worldwide. The company primarily offers deepwater and harsh environment drilling services. As of February 20, 2018, it owned or had partial ownership interests in, and operated 47 mobile offshore drilling units that consist of 27 ultra-deepwater floaters, 12 harsh environment floaters, 2 deepwater floaters, 6 midwater floaters, and 2 high-specification jackups. The company serves government-controlled oil companies and independent oil companies. Transocean Ltd. was founded in 1953 and is based in Steinhausen, Switzerland.
Ocean Rig UDW Company Profile
Ocean Rig UDW Inc., an offshore drilling contractor, provides oilfield services for offshore oil and gas exploration, development, and production drilling worldwide. It specializes in the ultra-deepwater and harsh-environment segment of the offshore drilling industry. The company owns and operates two fifth generation harsh weather ultra-deepwater semisubmersible offshore drilling units under the Leiv Eiriksson and Eirik Raude names; five sixth generation ultra-deepwater drilling units under the Ocean Rig Corcovado, the Ocean Rig Olympia, the Ocean Rig Poseidon, and the Ocean Rig Mykonos names; and four seventh generation drilling units under the Ocean Rig Mylos, the Ocean Rig Skyros, the Ocean Rig Athena, and the Ocean Rig Apollo names. It serves oil companies, integrated oil and gas companies, state-owned national oil companies, and independent oil and gas companies. The company is based in George Town, the Cayman Islands.
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