Critical Survey: Drilling Tools International (NASDAQ:DTI) & NOV (NYSE:NOV)

NOV (NYSE:NOV) and Drilling Tools International (NASDAQ:DTI) are both business services companies, but which is the better business? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, analyst recommendations, institutional ownership and risk.

Valuation and Earnings

This table compares NOV and Drilling Tools International’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NOV	$8.58 billion	0.87	$993.00 million	$2.49	7.58
Drilling Tools International	$152.03 million	1.10	$14.75 million	N/A	N/A

NOV has higher revenue and earnings than Drilling Tools International.

Analyst Recommendations

This is a breakdown of current recommendations for NOV and Drilling Tools International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NOV	2	5	8	0	2.40
Drilling Tools International	0	1	0	0	2.00

NOV currently has a consensus price target of $24.36, suggesting a potential upside of 29.08%. Drilling Tools International has a consensus price target of $3.00, suggesting a potential downside of 46.43%. Given NOV’s stronger consensus rating and higher probable upside, research analysts clearly believe NOV is more favorable than Drilling Tools International.

Profitability

This table compares NOV and Drilling Tools International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NOV	11.23%	10.45%	5.61%
Drilling Tools International	9.70%	20.30%	11.50%

Institutional & Insider Ownership

93.3% of NOV shares are held by institutional investors. Comparatively, 2.8% of Drilling Tools International shares are held by institutional investors. 1.9% of NOV shares are held by company insiders. Comparatively, 14.7% of Drilling Tools International shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

NOV has a beta of 1.74, indicating that its share price is 74% more volatile than the S&P 500. Comparatively, Drilling Tools International has a beta of -0.43, indicating that its share price is 143% less volatile than the S&P 500.

Summary

NOV beats Drilling Tools International on 8 of the 12 factors compared between the two stocks.

About NOV

NOV Inc. designs, constructs, manufactures, and sells systems, components, and products for oil and gas drilling and production, and industrial and renewable energy sectors in the United States and internationally. It operates through two segments, Energy Equipment, and Energy Products and Services. The company provides solids control and waste management equipment and services, managed pressure drilling, drilling fluids, premium drillpipe, wired pipe, drilling optimization services, tubular inspection and coating services, instrumentation, downhole tools, and drill bits. It also offers equipment and technologies for hydraulic fracture stimulation, including downhole multistage fracturing tools, pressure pumping trucks, blenders, sanders, hydration and injection units, flowline, and manifolds; coiled tubing units, and wireline units and tools; connections and liner hangers; onshore production consists of composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems; and offshore production, such as floating production systems and subsea production technologies, as well as manufactures industrial pumps and mixers. In addition, the company provides substructures, derricks, and masts; cranes; jacking systems; pipe lifting, racking, rotating, and assembly systems; mud pumps; pressure control equipment; drives and generators; rig instrumentation and control systems; mooring, anchor, and deck handling machinery; equipment components for offshore wind construction vessels; and pipelay and construction systems. Further, the company offers spare parts, repair, and rentals as well as comprehensive remote equipment monitoring, technical support, field service, and customer training. The company was formerly known as National Oilwell Varco, Inc. and changed its name to NOV Inc. in January 2021. NOV Inc. was founded in 1862 and is based in Houston, Texas.

About Drilling Tools International

Drilling Tools International Corporation provides oilfield equipment and services to oil and natural gas sectors in North America, Europe, and the Middle East. It offers downhole tool rentals, machining, and inspection services to support the global drilling and wellbore construction industry. The company also provides products are bottom hole assembly components, such as stabilizers, subs, non-magnetic and steel drill collars, hole openers, and roller reamers, as well as drill pipe and drill pipe accessories; ancillary equipment and handling tools to support its rental platform, including float valves, ring gauges, tool baskets, lift bail, lift subs, mud magnets, elevators, bracket and bail assemblies, slips, tongs, stabbing guides and safety clamps; and blowout preventers, and pressure control accessory equipment. In addition, it offers tool rental services, which consists of rental, inspection, machining, and repair services; rents downhole drilling tools used in horizontal and directional drilling of oil and natural gas; rents kellys, pip joints, work strings; maintains a fleet of rental equipment consisting of drill collars, stabilizers, crossover subs, wellbore conditioning tools, drill pipe, hevi-wate drill pipe, and tubing; rents surface control equipment, such as blowout preventers and handling tools; and provides downhole products for producing wells. Drilling Tools International Corporation is headquartered in Houston, Texas.