Comparing Liberty Energy (NYSE:LBRT) & Transocean (NYSE:RIG)

Liberty Energy (NYSE:LBRT) and Transocean (NYSE:RIG) are both mid-cap energy companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, earnings, dividends, profitability, analyst recommendations, valuation and risk.

Analyst Ratings

This is a summary of current recommendations for Liberty Energy and Transocean, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Liberty Energy	0	6	8	0	2.57
Transocean	3	5	3	1	2.17

Liberty Energy presently has a consensus target price of $26.42, suggesting a potential upside of 102.52%. Transocean has a consensus target price of $6.61, suggesting a potential upside of 19.59%. Given Liberty Energy’s stronger consensus rating and higher possible upside, research analysts plainly believe Liberty Energy is more favorable than Transocean.

Volatility and Risk

Liberty Energy has a beta of 0.72, suggesting that its stock price is 28% less volatile than the S&P 500. Comparatively, Transocean has a beta of 1.44, suggesting that its stock price is 44% more volatile than the S&P 500.

Profitability

This table compares Liberty Energy and Transocean’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Liberty Energy	0.91%	2.13%	0.99%
Transocean	7.25%	1.84%	1.00%

Dividends

Liberty Energy pays an annual dividend of $0.36 per share and has a dividend yield of 2.8%. Transocean pays an annual dividend of $0.60 per share and has a dividend yield of 10.9%. Liberty Energy pays out 150.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Transocean pays out 428.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Liberty Energy has increased its dividend for 2 consecutive years.

Earnings & Valuation

This table compares Liberty Energy and Transocean”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Liberty Energy	$4.01 billion	0.53	$147.87 million	$0.24	54.35
Transocean	$4.03 billion	1.53	-$2.92 billion	$0.14	39.46

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

Institutional and Insider Ownership

98.2% of Liberty Energy shares are held by institutional investors. Comparatively, 67.7% of Transocean shares are held by institutional investors. 2.0% of Liberty Energy shares are held by company insiders. Comparatively, 9.7% of Transocean shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Liberty Energy beats Transocean on 10 of the 18 factors compared between the two stocks.

About Liberty Energy

Liberty Energy Inc. is a Denver-based oilfield services company that supports onshore oil and natural gas producers, primarily in the United States. Founded in 2011 as Liberty Oilfield Services, the company adopted the Liberty Energy name in 2022. Its core business is hydraulic fracturing, a well-completion technique used to extract oil and natural gas. Liberty also provides related services and equipment, including wireline operations, proppant and logistics solutions, and technologies designed to support wellsite operations.

About Transocean

Transocean Ltd. is an offshore contract drilling company that provides drilling services to oil and gas companies around the world. Its work focuses on offshore exploration and development, particularly in deepwater and harsh-environment locations. The company owns and operates a fleet of offshore drilling rigs, including drillships and semisubmersible rigs. It contracts these rigs to customers and provides the crews and related services needed to conduct offshore drilling operations. Transocean serves customers across multiple offshore regions worldwide.