Transocean Partners (NYSE: RIGP) and Atwood Oceanics (NYSE:ATW) are both energy companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, dividends, profitabiliy, earnings, analyst recommendations, institutional ownership and valuation.
Earnings & Valuation
This table compares Transocean Partners and Atwood Oceanics’ gross revenue, earnings per share and valuation.
Atwood Oceanics has higher revenue and earnings than Transocean Partners. Atwood Oceanics is trading at a lower price-to-earnings ratio than Transocean Partners, indicating that it is currently the more affordable of the two stocks.
This table compares Transocean Partners and Atwood Oceanics’ net margins, return on equity and return on assets.
Volatility and Risk
Transocean Partners has a beta of 1.68, indicating that its stock price is 68% more volatile than the S&P 500. Comparatively, Atwood Oceanics has a beta of 2.26, indicating that its stock price is 126% more volatile than the S&P 500.
Transocean Partners pays an annual dividend of $1.45 per share and has a dividend yield of 8.1%. Atwood Oceanics does not pay a dividend. Transocean Partners pays out 70.0% of its earnings in the form of a dividend.
This is a summary of recent ratings and price targets for Transocean Partners and Atwood Oceanics, as reported by MarketBeat.
Transocean Partners presently has a consensus target price of $12.55, suggesting a potential downside of 29.61%. Atwood Oceanics has a consensus target price of $11.91, suggesting a potential upside of 19.20%. Given Atwood Oceanics’ higher probable upside, analysts plainly believe Atwood Oceanics is more favorable than Transocean Partners.
Institutional and Insider Ownership
29.0% of Transocean Partners shares are held by institutional investors. Comparatively, 90.6% of Atwood Oceanics shares are held by institutional investors. 0.1% of Transocean Partners shares are held by company insiders. Comparatively, 1.2% of Atwood Oceanics shares are held by company 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.
Atwood Oceanics beats Transocean Partners on 8 of the 13 factors compared between the two stocks.
About Transocean Partners
Transocean Partners LLC a limited liability company. The Company is formed by Transocean Partners Holdings Limited and a subsidiary of Transocean Ltd. (Transocean), to own, operate and acquire advanced offshore drilling rigs. The Company’s assets consist of over 50% ownership interest in each of the entities that owns and operates over three ultra-deepwater drilling rigs that are operating in the U.S. Gulf of Mexico, which include Discoverer Clear Leader, Discoverer Inspiration and Development Driller III. The Company owns or has partial ownership interests in, and operated over 60 mobile offshore drilling units, including approximately 30 ultra-deepwater floaters, over seven harsh environment floaters, approximately five deepwater floaters, over 10 midwater floaters and approximately 10 high-specification jackups. Transocean also has approximately six ultra-deepwater drillships and over five high-specification jackups under construction.
About Atwood Oceanics
Atwood Oceanics, Inc. is an offshore drilling company engaged in the drilling and completion of exploration and development wells for the global oil and gas industry. The Company owns various types of drilling rigs, such as Ultra-Deepwater Rigs, Deepwater Semisubmersibles and Jackups. Its Ultra-deepwater Rigs and Deepwater Semisubmersibles include Atwood Achiever, Atwood Archer, Atwood Admiral, Atwood Advantage, Atwood Condor, Atwood Eagle and Atwood Osprey. Its Jackup Rigs included Atwood Mako, Atwood Manta, Atwood Aurora, Atwood Beacon and Atwood Orca. The Atwood Mako and Atwood Manta, both approximately 400-foot water depth Pacific Class jackup rigs, are operating offshore Vietnam and offshore Thailand. The Atwood Aurora, an approximately 350-foot water depth jackup, is operating offshore West Africa. The Atwood Beacon, an approximately 400-foot water depth jackup, is operating in the Mediterranean Sea.