Financial Contrast: Frank’s International N.V. (FI) & McDermott International (NYSE:MDR)

McDermott International (NYSE: MDR) and Frank’s International N.V. (NYSE:FI) are both small-cap oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, dividends, profitability and institutional ownership.

Profitability

This table compares McDermott International and Frank’s International N.V.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
McDermott International 2.95% 5.55% 2.78%
Frank’s International N.V. -35.28% -8.97% -7.39%

Valuation and Earnings

This table compares McDermott International and Frank’s International N.V.’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
McDermott International $2.51 billion 0.65 $304.29 million $0.27 21.30
Frank’s International N.V. $441.49 million 3.17 -$18.12 million ($0.75) -8.36

McDermott International has higher revenue and earnings than Frank’s International N.V.. Frank’s International N.V. is trading at a lower price-to-earnings ratio than McDermott International, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

McDermott International has a beta of 1.37, meaning that its stock price is 37% more volatile than the S&P 500. Comparatively, Frank’s International N.V. has a beta of 1.08, meaning that its stock price is 8% more volatile than the S&P 500.

Dividends

Frank’s International N.V. pays an annual dividend of $0.30 per share and has a dividend yield of 4.8%. McDermott International does not pay a dividend. Frank’s International N.V. pays out -40.0% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current recommendations and price targets for McDermott International and Frank’s International N.V., as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
McDermott International 0 3 5 0 2.63
Frank’s International N.V. 3 11 0 0 1.79

McDermott International presently has a consensus price target of $8.26, indicating a potential upside of 43.60%. Frank’s International N.V. has a consensus price target of $9.59, indicating a potential upside of 52.97%. Given Frank’s International N.V.’s higher probable upside, analysts plainly believe Frank’s International N.V. is more favorable than McDermott International.

Insider and Institutional Ownership

76.6% of McDermott International shares are owned by institutional investors. Comparatively, 29.5% of Frank’s International N.V. shares are owned by institutional investors. 1.3% of McDermott International shares are owned by insiders. Comparatively, 77.9% of Frank’s International N.V. shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

McDermott International beats Frank’s International N.V. on 10 of the 15 factors compared between the two stocks.

McDermott International Company Profile

McDermott International, Inc. is a provider of integrated engineering, procurement, construction and installation (EPCI), front-end engineering and design (FEED) and module fabrication services for upstream field developments across the world. The Company delivers fixed and floating production facilities, pipeline installations and subsea systems from concept to commissioning for offshore and subsea oil and gas projects. It operates through three segments: the Americas, Europe and Africa (AEA), the Middle East (MEA) and Asia (ASA). As of December 31, 2016, operated in approximately 20 countries across the Americas, Europe, Africa, the Middle East, Asia and Australia, its integrated resources include a diversified fleet of marine vessels, fabrication facilities and engineering offices. It support its activities with project management and procurement services, while utilizing its fully integrated capabilities in both shallow water and deepwater construction.

Frank’s International N.V. Company Profile

Frank’s International N.V. (FINV) is a provider of engineered tubular services, tubular fabrication and specialty well construction and well intervention solutions to the oil and gas industry. The Company operates through four business segments: International Services, U. S. Services, Tubular Sales and Blackhawk. As of December 31, 2016, the International Services segment provided tubular services in international offshore markets and in several onshore international regions in approximately 60 countries on six continents. The U.S. Services segment provides tubular services. The Blackhawk segment provides well construction and well intervention rental equipment, services and products, in addition to the cementing tool expertise, in the United States and Mexican Gulf of Mexico, onshore United States and other select international locations.

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