Reviewing Newpark Resources (NR) & IRIS International (IRIS)

Newpark Resources (NYSE: NR) and IRIS International (NASDAQ:IRIS) are both small-cap oils/energy companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, profitability, institutional ownership, valuation, dividends, analyst recommendations and risk.

Institutional and Insider Ownership

68.9% of IRIS International shares are owned by institutional investors. 4.7% of Newpark Resources shares are owned by insiders. Comparatively, 9.7% of IRIS International shares are owned by 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.

Earnings & Valuation

This table compares Newpark Resources and IRIS International’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Newpark Resources $583.35 million 1.11 $24.26 million ($0.15) -50.33
IRIS International $47.70 million 0.82 -$24.80 million ($2.49) -1.30

Newpark Resources has higher revenue and earnings than IRIS International. Newpark Resources is trading at a lower price-to-earnings ratio than IRIS International, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Newpark Resources and IRIS International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Newpark Resources -2.20% -2.92% -1.82%
IRIS International -61.58% -36.70% -29.47%

Risk & Volatility

Newpark Resources has a beta of 1.6, suggesting that its share price is 60% more volatile than the S&P 500. Comparatively, IRIS International has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Newpark Resources and IRIS International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Newpark Resources 0 1 4 0 2.80
IRIS International 0 0 0 0 N/A

Newpark Resources currently has a consensus target price of $29.00, indicating a potential upside of 284.11%. Given Newpark Resources’ higher probable upside, analysts plainly believe Newpark Resources is more favorable than IRIS International.

Summary

Newpark Resources beats IRIS International on 10 of the 12 factors compared between the two stocks.

About Newpark Resources

Newpark Resources, Inc. is a supplier providing products and services primarily to the oil and gas exploration and production (E&P) industry. The Company’s segments include Fluids Systems, and Mats and Integrated Services. The Fluids Systems segment provides drilling fluids products and technical services to customers in the North America; Europe, the Middle East and Africa; Latin America, and Asia Pacific regions. The Mats and Integrated Services segment provides composite mat rentals, as well as location construction and related site services, to customers at well, production, transportation and refinery locations in the United States. It manufactures and sells composite mats to customers outside of the United States, and to domestic customers outside of the oil and gas exploration market. The Fluids Systems segment offers customized solutions for technical drilling projects involving subsurface conditions, such as horizontal, directional, geologically deep or deep water drilling.

About IRIS International

Mitcham Industries, Inc. is a provider of equipment to the geophysical, oceanographic and hydrographic industries. The Company operates through two segments. The Equipment Leasing segment is primarily engaged in the leasing of seismic equipment to companies in the oil and gas industry across the world. The Equipment Manufacturing and Sales segment is engaged in the design, production and sale of marine seismic equipment, and oceanographic and hydrographic equipment. Its leasing business includes Mitcham Canada ULC, Seismic Asia Pacific Pty Ltd., Mitcham Seismic Eurasia LLC, Mitcham Europe Ltd. and Mitcham Marine Leasing Pte. Ltd. The Equipment Manufacturing and Sales Segment includes its Seamap International Holdings Pte, Ltd. (Seamap) business and Klein Marine Systems, Inc. (Klein). Seamap designs, manufactures and sells a range of products for the seismic, hydrographic and offshore industries. Klein develops and manufactures high performance side scan sonar systems.

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