Rowan Companies (NYSE: SDLP) and Seadrill Partners (NYSE:SDLP) are both oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, analyst recommendations, profitability, institutional ownership, risk, dividends and earnings.

Dividends

Seadrill Partners pays an annual dividend of $0.40 per share and has a dividend yield of 11.2%. Rowan Companies does not pay a dividend.

Volatility & Risk

Rowan Companies has a beta of 1.86, suggesting that its share price is 86% more volatile than the S&P 500. Comparatively, Seadrill Partners has a beta of 2.13, suggesting that its share price is 113% more volatile than the S&P 500.

Profitability

This table compares Rowan Companies and Seadrill Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rowan Companies -9.41% -4.70% -2.98%
Seadrill Partners 17.22% 5.40% 2.27%

Earnings and Valuation

This table compares Rowan Companies and Seadrill Partners’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Rowan Companies $1.28 billion 1.61 $72.70 million ($0.64) -25.38
Seadrill Partners $1.13 billion 0.24 $141.20 million N/A N/A

Seadrill Partners has lower revenue, but higher earnings than Rowan Companies.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Rowan Companies and Seadrill Partners, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rowan Companies 1 10 8 0 2.37
Seadrill Partners 0 0 0 0 N/A

Rowan Companies currently has a consensus price target of $15.08, suggesting a potential downside of 7.16%. Given Rowan Companies’ higher probable upside, equities analysts plainly believe Rowan Companies is more favorable than Seadrill Partners.

Insider and Institutional Ownership

97.8% of Rowan Companies shares are held by institutional investors. Comparatively, 16.3% of Seadrill Partners shares are held by institutional investors. 1.6% of Rowan Companies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Seadrill Partners beats Rowan Companies on 7 of the 13 factors compared between the two stocks.

About Rowan Companies

Rowan Companies plc provides offshore oil and gas contract drilling services to the oil and gas industry. The company operates through Deepwater, Jack-ups, and ARO segments. The Deepwater segment operates 4 ultra-deepwater drillships. The Jack-ups segment operates 23 self-elevating jack-up rigs. The ARO segment operates 5 self-elevating jack-up rigs. The company operates in the United States Gulf of Mexico, the United Kingdom, and Norwegian sectors of the North Sea, the Middle East, and Trinidad. Rowan Companies plc was founded in 1923 and is based in Houston, Texas.

About Seadrill Partners

Seadrill Partners LLC owns, operates, and acquires offshore drilling units in the United States, Angola, Thailand, Canada, Equatorial Guinea, Nigeria, Indonesia, Ghana, and internationally. The company primarily serves various oil and gas companies. As of March 31, 2018, its fleet consisted of four semi-submersible drilling rigs, four drillships, and three tender rigs. The company was founded in 2012 and is headquartered in London, the United Kingdom.

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