Select Water Solutions (NYSE:WTTR) versus Seadrill (NYSE:SDRL) Financial Analysis
by Tristan Rich · The Markets DailySeadrill (NYSE:SDRL – Get Free Report) and Select Water Solutions (NYSE:WTTR – Get Free Report) are both mid-cap energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, profitability, analyst recommendations and institutional ownership.
Valuation and Earnings
This table compares Seadrill and Select Water Solutions”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Seadrill | $1.44 billion | 2.09 | -$77.00 million | $0.03 | 1,603.33 |
| Select Water Solutions | $1.41 billion | 2.03 | $21.22 million | $0.28 | 73.78 |
Select Water Solutions has lower revenue, but higher earnings than Seadrill. Select Water Solutions is trading at a lower price-to-earnings ratio than Seadrill, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Seadrill and Select Water Solutions’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Seadrill | 0.07% | 0.64% | 0.46% |
| Select Water Solutions | 2.24% | 3.11% | 1.92% |
Institutional & Insider Ownership
95.7% of Seadrill shares are held by institutional investors. Comparatively, 81.7% of Select Water Solutions shares are held by institutional investors. 0.5% of Seadrill shares are held by company insiders. Comparatively, 6.2% of Select Water Solutions shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Risk & Volatility
Seadrill has a beta of 1.22, meaning that its share price is 22% more volatile than the S&P 500. Comparatively, Select Water Solutions has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Seadrill and Select Water Solutions, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Seadrill | 1 | 2 | 3 | 3 | 2.89 |
| Select Water Solutions | 0 | 3 | 6 | 0 | 2.67 |
Seadrill presently has a consensus price target of $59.40, indicating a potential upside of 23.49%. Select Water Solutions has a consensus price target of $23.00, indicating a potential upside of 11.33%. Given Seadrill’s stronger consensus rating and higher possible upside, analysts clearly believe Seadrill is more favorable than Select Water Solutions.
Summary
Seadrill beats Select Water Solutions on 8 of the 15 factors compared between the two stocks.
About Seadrill
Seadrill Ltd. engages in the provision of offshore drilling services to the oil and gas industry. It operates through the following segments: Floaters, Jack-up rigs, and Other. The Floaters segment encompasses drilling, completion, and maintenance of offshore exploration and production wells. the Jack-up Rigs segment includes drilling contracts relate to jack-up rigs for operations in harsh and benign environments in shallow water. The Other segment represents management services to third parties and related parties. The company was founded on May 10, 2005 and is headquartered in Hamilton, Bermuda.
About Select Water Solutions
Select Water Solutions, Inc., together with its subsidiaries, provides water management and chemical solutions to the energy industry in the United States. The company operates through three segments: Water Services, Water Infrastructure, and Chemical Technologies. The Water Services segment provides water-related services, including water sourcing, water transfer, flowback and well testing, water containment, fluids hauling, water monitoring, and water network automation; technology solutions comprising hydrographic mapping, water volume and quality monitoring, remote pit and tank monitoring, leak detection, asset and fuel tracking, and automated-equipment services, as well as various surface rental equipment and workforce accommodation services. The Water Infrastructure segment engages in the recycling, gathering, transferring, and disposal of water through a network of permanent pipeline infrastructure, semi-permanent pipeline infrastructure, water recycling facilities, earthen pits, water sources, and SWDs; provides solids management services; and develops, builds, and operates semi-permanent and permanent infrastructure solutions. The Chemical Technologies segment provides technical solutions, products, and services related to chemical applications in the oil and gas industry. This segment develops, manufactures, and manages logistics; and provides chemicals used in hydraulic fracturing, stimulation, cementing, and well completions for pressure pumpers and oil and gas producers, as well as offers production chemical solutions for underperforming wells, corrosion and scale monitoring, chemical inventory management, well failure analysis, and lab services. It primarily serves oil and gas producers. The company was formerly known as Select Energy Services, Inc. and changed its name to Select Water Solutions, Inc. in May 2023. Select Water Solutions, Inc. was incorporated in 2016 and is headquartered in Houston, Texas.