Head-To-Head Review: Nabors Industries (NYSE:NBR) and ProPetro (NYSE:PUMP)

Nabors Industries (NYSE:NBR) and ProPetro (NYSE:PUMP) are both small-cap energy companies, but which is the better investment? We will contrast the two companies based on the strength of their valuation, dividends, institutional ownership, risk, earnings, profitability and analyst recommendations.

Earnings and Valuation

This table compares Nabors Industries and ProPetro”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nabors Industries	$3.21 billion	0.46	$286.62 million	$13.44	6.87
ProPetro	$1.16 billion	1.20	$820,000.00	($0.11)	-103.36

Nabors Industries has higher revenue and earnings than ProPetro. ProPetro is trading at a lower price-to-earnings ratio than Nabors Industries, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current recommendations for Nabors Industries and ProPetro, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nabors Industries	0	6	2	0	2.25
ProPetro	1	2	8	0	2.64

Nabors Industries currently has a consensus price target of $102.57, suggesting a potential upside of 11.07%. ProPetro has a consensus price target of $16.50, suggesting a potential upside of 45.12%. Given ProPetro’s stronger consensus rating and higher probable upside, analysts plainly believe ProPetro is more favorable than Nabors Industries.

Profitability

This table compares Nabors Industries and ProPetro’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nabors Industries	7.64%	-7.06%	-1.45%
ProPetro	-1.15%	-1.49%	-0.89%

Volatility and Risk

Nabors Industries has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, ProPetro has a beta of 0.77, meaning that its stock price is 23% less volatile than the S&P 500.

Institutional & Insider Ownership

81.9% of Nabors Industries shares are owned by institutional investors. Comparatively, 84.7% of ProPetro shares are owned by institutional investors. 5.3% of Nabors Industries shares are owned by insiders. Comparatively, 1.5% of ProPetro shares are owned 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.

About Nabors Industries

Nabors Industries Ltd. provides drilling and drilling-related services for land-based and offshore oil and natural gas wells in the United States and internationally. The company operates through four segments: U.S. Drilling, International Drilling, Drilling Solutions, and Rig Technologies. It provides tubular running services, including casing and tubing running, and torque monitoring; managed pressure drilling services; and drilling-bit steering systems and rig instrumentation software. The company also offers drilling systems comprising ROCKit, a directional steering control system; SmartNAV, a collaborative guidance and advisory platform; SmartSLIDE, a directional steering control system; and RigCLOUD, a digital infrastructure to integrate applications to deliver real-time insight into operations across the rig fleet. In addition, it operates a fleet of land-based drilling rigs and marketed platforms rigs; manufactures and sells top drives, catwalks, wrenches, drawworks, and other drilling related equipment, such as robotic systems and downhole tools; and provides aftermarket sales and services for the installed base of its equipment. Nabors Industries Ltd. was founded in 1952 and is based in Hamilton, Bermuda.

About ProPetro

ProPetro Holding Corp. operates as an integrated oilfield services company. The company provides hydraulic fracturing, wireline, cementing, and other complementary oilfield completion services to upstream oil and gas companies in the Permian Basin. ProPetro Holding Corp. was founded in 2007 and is headquartered in Midland, Texas.