Seadrill (NYSE:SDRL – Get Free Report) and Valaris (NYSE:VAL – Get Free Report) are both energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, profitability, institutional ownership, valuation, dividends, analyst recommendations and risk.
Profitability
This table compares Seadrill and Valaris’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Seadrill | 27.49% | 4.68% | 3.31% |
| Valaris | 12.61% | 14.14% | 7.06% |
Analyst Recommendations
This is a breakdown of recent ratings for Seadrill and Valaris, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Seadrill | 0 | 0 | 4 | 0 | 3.00 |
| Valaris | 1 | 5 | 1 | 0 | 2.00 |
Institutional and Insider Ownership
95.7% of Seadrill shares are owned by institutional investors. Comparatively, 96.7% of Valaris shares are owned by institutional investors. 0.2% of Seadrill shares are owned by insiders. Comparatively, 0.7% of Valaris shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Risk & Volatility
Seadrill has a beta of 1.6, suggesting that its share price is 60% more volatile than the S&P 500. Comparatively, Valaris has a beta of 1.15, suggesting that its share price is 15% more volatile than the S&P 500.
Valuation & Earnings
This table compares Seadrill and Valaris”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Seadrill | $1.39 billion | 1.27 | $446.00 million | $5.29 | 5.33 |
| Valaris | $2.36 billion | 1.41 | $373.40 million | $4.26 | 11.03 |
Seadrill has higher earnings, but lower revenue than Valaris. Seadrill is trading at a lower price-to-earnings ratio than Valaris, indicating that it is currently the more affordable of 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 Valaris
Valaris Limited, together with its subsidiaries, provides offshore contract drilling services Gulf of Mexico, South America, North Sea, the Middle East, Africa, and the Asia Pacific. The company operates through four segments: Floaters, Jackups, ARO, and Other. It owns an offshore drilling rig fleet, which include drillships, dynamically positioned semisubmersible rigs, moored semisubmersible rig, and jackup rigs. It serves international, government-owned, and independent oil and gas. Valaris Limited was founded in 1975 and is based in Hamilton, Bermuda.
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