Head-To-Head Contrast: Saipem (OTCMKTS:SAPMF) and Transocean (NYSE:RIG)

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

Institutional & Insider Ownership

67.7% of Transocean shares are owned by institutional investors. 12.3% of Transocean shares are owned by company 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 Saipem and Transocean”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Saipem	$15.75 billion	0.35	$331.12 million	N/A	N/A
Transocean	$3.52 billion	0.86	-$512.00 million	($1.86)	-1.74

Saipem has higher revenue and earnings than Transocean.

Analyst Recommendations

This is a summary of current recommendations and price targets for Saipem and Transocean, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Saipem	0	1	0	1	3.00
Transocean	1	6	3	0	2.20

Transocean has a consensus price target of $4.26, indicating a potential upside of 31.75%. Given Transocean’s higher probable upside, analysts clearly believe Transocean is more favorable than Saipem.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Saipem	N/A	N/A	N/A
Transocean	-39.64%	0.45%	0.24%

Volatility & Risk

Saipem has a beta of 1.35, indicating that its stock price is 35% more volatile than the S&P 500. Comparatively, Transocean has a beta of 2.68, indicating that its stock price is 168% more volatile than the S&P 500.

Summary

Transocean beats Saipem on 8 of the 13 factors compared between the two stocks.

About Saipem

Saipem SpA provides energy and infrastructure solutions worldwide. The company operates through Asset Based Services, Offshore Drilling, and Energy Carriers segments. It offers development of subsea fields and pipelaying; installation and lifting of offshore structures; and engineering, implementation, installation, maintenance, modification, and decommissioning activities. The company also engages in onshore engineering and construction, sustainable infrastructures, and robotics and industrialized solutions; and offshore engineering and construction, and wind activities. In addition, the company provides procurement, construction, project management, and engineering integrated services to the oil and gas, civil and marine infrastructure, and environmental markets. Saipem S.p.A. was founded in 1957 and is headquartered in Milan, Italy.

About Transocean

Transocean Ltd., together with its subsidiaries, provides offshore contract drilling services for oil and gas wells worldwide. It contracts mobile offshore drilling rigs, related equipment, and work crews to drill oil and gas wells. The company operates a fleet of mobile offshore drilling units, consisting of ultra-deepwater floaters and harsh environment floaters. It serves integrated energy companies, government-owned or government-controlled energy companies, and other independent energy companies. The company was founded in 1926 and is based in Steinhausen, Switzerland.