Ocean Rig UDW (ORIG) and Noble Corporation (NE) Critical Review

Ocean Rig UDW (NASDAQ: ORIG) and Noble Corporation (NYSE:NE) are both oils/energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, risk, profitability, dividends, earnings, valuation and institutional ownership.

Risk & Volatility

Ocean Rig UDW has a beta of 1.61, indicating that its share price is 61% more volatile than the S&P 500. Comparatively, Noble Corporation has a beta of 2.28, indicating that its share price is 128% more volatile than the S&P 500.

Institutional & Insider Ownership

95.6% of Noble Corporation shares are held by institutional investors. 1.6% of Noble Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Ocean Rig UDW and Noble Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ocean Rig UDW N/A N/A N/A
Noble Corporation -122.04% -3.19% -1.83%

Analyst Ratings

This is a summary of recent ratings and target prices for Ocean Rig UDW and Noble Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ocean Rig UDW 0 0 0 0 N/A
Noble Corporation 6 17 4 0 1.93

Noble Corporation has a consensus target price of $5.65, indicating a potential upside of 48.36%. Given Noble Corporation’s higher possible upside, analysts plainly believe Noble Corporation is more favorable than Ocean Rig UDW.

Valuation and Earnings

This table compares Ocean Rig UDW and Noble Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Ocean Rig UDW $1.28 billion 1.60 $847.65 million ($40.71) -0.61
Noble Corporation $1.40 billion 0.67 $639.70 million ($7.21) -0.53

Ocean Rig UDW has higher revenue, but lower earnings than Noble Corporation. Ocean Rig UDW is trading at a lower price-to-earnings ratio than Noble Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Noble Corporation beats Ocean Rig UDW on 7 of the 12 factors compared between the two stocks.

Ocean Rig UDW Company Profile

Ocean Rig UDW Inc is a Cyprus-based offshore drilling contractor that provides oilfield services for oil and gas exploration, development and production drilling, and specializes in the ultra-deepwater and harsh-environment segment of the drilling industry. The Company owns and operates approximately 13 offshore ultra deepwater drilling units, comprising of ultra deepwater semisubmersible drilling rigs and ultra deepwater drill-ships. The Company’s drilling units include Leiv Eiriksson, Ocean Rig Corcovado, Ocean Rig Poseidon, Ocean Rig Mykonos, Ocean Rig Mylos, Ocean Rig Skyros and Ocean Rig Athena. In addition, the Company, through its wholly owned subsidiary, provides supervisory management services including onshore management to its operating drilling units and drilling units under construction.

Noble Corporation Company Profile

Noble Corporation is an offshore drilling contractor for the oil and gas industry. The Company performs contract drilling services with its fleet of 79 mobile offshore drilling units and one floating production storage and offloading unit (NYSE:NE) located globally.

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