Comparing Enerflex (NYSE:EFXT) and Seadrill (NYSE:SDRL)

Seadrill (NYSE:SDRL) and Enerflex (NYSE:EFXT) are both mid-cap energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.

Valuation and Earnings

This table compares Seadrill and Enerflex”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Seadrill	$1.44 billion	2.10	-$77.00 million	$0.03	1,612.20
Enerflex	$2.57 billion	1.17	$64.00 million	$0.43	57.06

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

Institutional and Insider Ownership

95.7% of Seadrill shares are held by institutional investors. Comparatively, 46.5% of Enerflex shares are held by institutional investors. 0.5% of Seadrill shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Volatility and Risk

Seadrill has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500. Comparatively, Enerflex has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500.

Profitability

This table compares Seadrill and Enerflex’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Seadrill	0.07%	0.64%	0.46%
Enerflex	2.06%	11.76%	4.84%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Seadrill and Enerflex, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Seadrill	0	3	3	3	3.00
Enerflex	1	1	6	1	2.78

Seadrill currently has a consensus price target of $59.40, indicating a potential upside of 22.81%. Enerflex has a consensus price target of $38.67, indicating a potential upside of 57.59%. Given Enerflex’s higher possible upside, analysts clearly believe Enerflex is more favorable than Seadrill.

Summary

Enerflex beats Seadrill on 9 of the 15 factors compared between the two stocks.

About Seadrill

Seadrill Ltd. engages in the provision of offshore drilling services to the oil and gas industry. It operates through the following segments: Floaters, Jack-up rigs, and Other. The Floaters segment encompasses drilling, completion, and maintenance of offshore exploration and production wells. the Jack-up Rigs segment includes drilling contracts relate to jack-up rigs for operations in harsh and benign environments in shallow water. The Other segment represents management services to third parties and related parties. The company was founded on May 10, 2005 and is headquartered in Hamilton, Bermuda.

About Enerflex

Enerflex Ltd. offers energy infrastructure and energy transition solutions to natural gas markets in North America, Latin America, and the Eastern Hemisphere. The company provides natural gas compression infrastructure, processing, and treated water infrastructure under contract to oil and natural gas customers; power generation rental solutions; custom and standard compression packages for reciprocating and screw compressor applications; re-engineering, re-configuration, and re-packaging of compressors for various field applications; integrated turnkey power generation, gas compression, processing facilities, natural gas compression, processing, and electric power solutions; after-market mechanical services and parts distribution, as well as maintenance solutions to the oil and natural gas industry, operations, and overhaul services; and equipment supply, parts supply, and general asset management. It also designs, engineers, manufactures, constructs, and installs modular natural gas processing equipment, low-carbon solutions, cryogenic systems, electric power solutions, and treated water solutions; and engages in the engineering, design, procurement, project management, and construction services for compression, process, treated water, and power generation equipment, as well as after-market service, parts, and operations and maintenance services for gas compression, processing, and treated water facilities in the region. The company was formerly known as Enerflex Systems Income Fund and changed its name to Enerflex Ltd. in January 2010. Enerflex Ltd. was founded in 1980 and is headquartered in Calgary, Canada.