Reviewing ProPetro (NYSE:PUMP) & Baker Hughes (NASDAQ:BKR)

ProPetro (NYSE:PUMP) and Baker Hughes (NASDAQ:BKR) are both energy companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, institutional ownership, analyst recommendations, risk, valuation and profitability.

Risk & Volatility

ProPetro has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.Comparatively, Baker Hughes has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500.

Valuation & Earnings

This table compares ProPetro and Baker Hughes”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ProPetro	$1.44 billion	0.37	-$137.86 million	($1.47)	-3.49
Baker Hughes	$27.83 billion	1.59	$2.98 billion	$3.06	14.65

Baker Hughes has higher revenue and earnings than ProPetro. ProPetro is trading at a lower price-to-earnings ratio than Baker Hughes, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares ProPetro and Baker Hughes’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ProPetro	-11.10%	1.84%	1.22%
Baker Hughes	11.04%	14.56%	6.53%

Analyst Ratings

This is a summary of recent ratings and recommmendations for ProPetro and Baker Hughes, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ProPetro	2	5	1	0	1.88
Baker Hughes	0	4	22	0	2.85

ProPetro currently has a consensus price target of $6.80, indicating a potential upside of 32.42%. Baker Hughes has a consensus price target of $52.57, indicating a potential upside of 17.25%. Given ProPetro’s higher possible upside, equities research analysts clearly believe ProPetro is more favorable than Baker Hughes.

Insider & Institutional Ownership

84.7% of ProPetro shares are owned by institutional investors. Comparatively, 92.1% of Baker Hughes shares are owned by institutional investors. 1.6% of ProPetro shares are owned by insiders. Comparatively, 0.3% of Baker Hughes shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Baker Hughes beats ProPetro on 11 of the 14 factors compared between the two stocks.

About ProPetro

ProPetro Holding Corp. operates as an integrated oilfield services company. The company provides hydraulic fracturing, wireline, cementing, and other complementary oilfield completion services to upstream oil and gas companies in the Permian Basin. ProPetro Holding Corp. was founded in 2007 and is headquartered in Midland, Texas.

About Baker Hughes

Baker Hughes Company provides a portfolio of technologies and services to energy and industrial value chain worldwide. The company operates through Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET) segments. The OFSE segment designs and manufactures products and provides related services, including exploration, appraisal, development, production, rejuvenation, and decommissioning for onshore and offshore oilfield operations. This segment also provides drilling services, drill bits, and drilling and completions fluids; completions, intervention, measurements, pressure pumping, and wireline services; artificial lift systems, and oilfield and industrial chemicals; subsea projects and services, flexible pipe systems, and surface pressure control systems; and integrated well services and solutions. It serves oil and natural gas companies; the United States and international independent oil and natural gas companies; national or state-owned oil companies; engineering, procurement, and construction contractors; geothermal companies; and other oilfield service companies. The IET segment provides gas technology equipment, including drivers, driven equipment, flow control, and turnkey solutions for the mechanical-drive, compression, and power-generation applications; and energy sectors, such as oil and gas, LNG operations, petrochemical, and carbon solutions. This segment also provides rack-based vibration monitoring equipment and sensors; integrated asset performance management products; inspection services; pumps, valves, and gears; precision sensors and instrumentation, and condition monitoring solutions. It serves upstream, midstream, downstream, onshore, offshore, and small and large scale customers. The company was formerly known as Baker Hughes, a GE company and changed its name to Baker Hughes Company in October 2019. Baker Hughes Company was incorporated in 2016 and is based in Houston, Texas.