RigNet (NASDAQ: RNET) and Select Energy Services (NASDAQ:WTTR) are both small-cap computer and technology companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, valuation, profitability, institutional ownership, analyst recommendations, dividends and risk.
Insider & Institutional Ownership
91.3% of RigNet shares are owned by institutional investors. 1.2% of RigNet shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
This is a summary of current ratings for RigNet and Select Energy Services, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Select Energy Services||1||1||5||0||2.57|
RigNet currently has a consensus target price of $19.33, indicating a potential upside of 9.54%. Select Energy Services has a consensus target price of $18.86, indicating a potential upside of 24.63%. Given Select Energy Services’ stronger consensus rating and higher possible upside, analysts plainly believe Select Energy Services is more favorable than RigNet.
This table compares RigNet and Select Energy Services’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Select Energy Services||-7.80%||-11.02%||-8.68%|
Valuation & Earnings
This table compares RigNet and Select Energy Services’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|RigNet||$200.61 million||1.60||$22.97 million||($0.65)||-27.15|
|Select Energy Services||$395.02 million||1.16||$45.45 million||N/A||N/A|
Select Energy Services has higher revenue and earnings than RigNet.
RigNet beats Select Energy Services on 6 of the 11 factors compared between the two stocks.
RigNet Company Profile
RigNet, Inc. (RigNet) provides customized systems and solutions serving customers with data networking and operational requirements. The Company provides voice and data network, video conferencing and monitoring, crew welfare, asset and weather monitoring, and real-time data services. It operates through two segments: Managed Services, and Systems Integration and Automation (SI&A). The Managed Services segment provides remote communications services for offshore and onshore drilling rigs and production facilities, as well as, support vessels and other remote sites. The SI&A segment provides customized solutions for customer telecommunications systems. As of December 31, 2016, the Company provided remote communications and collaborative services to approximately 500 customers reaching approximately 900 remote sites located in approximately 50 countries on six continents. It provides managed remote communications, engineered telecommunications solutions and applications.
Select Energy Services Company Profile
Select Energy Services, Inc. is a holding company. The Company is provider of total water solutions to the United States unconventional oil and gas industry. The Company is engaged in sourcing and transfer of water prior to its use in drilling and completion activities associated with hydraulic fracturing or fracking, which collectively referrd to as pre-frac water services. The Company provides its services to integrated and exploration and production (E&P) companies. Its operating segments include water solutions, accommodation and rentals, and wellsite completion and constructive services. The Company’s services include water sourcing, water transfer, water treatment, fluid handling, disposal solutions, accommodations, rentals, and wellsite construction. The Company also provides complementary water-related services that support oil and gas well completion and production activities including containment, monitoring, treatment, flowback, hauling and disposal.
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