Head to Head Survey: Seadrill (NYSE:SDRL) and Liberty Energy (NYSE:LBRT)

Liberty Energy (NYSE:LBRT) and Seadrill (NYSE:SDRL) are both mid-cap energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, institutional ownership, valuation, risk and profitability.

Profitability

This table compares Liberty Energy and Seadrill’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Liberty Energy	2.92%	1.14%	0.57%
Seadrill	0.07%	0.64%	0.46%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Liberty Energy and Seadrill, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Liberty Energy	0	6	8	0	2.57
Seadrill	0	3	3	3	3.00

Liberty Energy currently has a consensus target price of $27.21, indicating a potential upside of 62.77%. Seadrill has a consensus target price of $59.40, indicating a potential upside of 28.31%. Given Liberty Energy’s higher probable upside, equities analysts clearly believe Liberty Energy is more favorable than Seadrill.

Institutional & Insider Ownership

98.2% of Liberty Energy shares are owned by institutional investors. Comparatively, 95.7% of Seadrill shares are owned by institutional investors. 2.0% of Liberty Energy shares are owned by insiders. Comparatively, 0.5% of Seadrill 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.

Valuation and Earnings

This table compares Liberty Energy and Seadrill”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Liberty Energy	$4.01 billion	0.68	$147.87 million	$0.74	22.59
Seadrill	$1.53 billion	1.89	-$77.00 million	$0.03	1,543.10

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

Risk and Volatility

Liberty Energy has a beta of 0.71, suggesting that its share price is 29% less volatile than the S&P 500. Comparatively, Seadrill has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.

Dividends

Liberty Energy pays an annual dividend of $0.36 per share and has a dividend yield of 2.2%. Seadrill pays an annual dividend of $4.00 per share and has a dividend yield of 8.6%. Liberty Energy pays out 48.6% of its earnings in the form of a dividend. Seadrill pays out 13,333.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Liberty Energy has raised its dividend for 2 consecutive years.

Summary

Liberty Energy beats Seadrill on 12 of the 18 factors compared between the two stocks.

About Liberty Energy

Liberty Energy Inc. provides hydraulic services and related technologies to onshore oil and natural gas exploration, and production companies in North America. The company offers hydraulic fracturing services, including complementary services, such as wireline services, proppant delivery solutions, field gas processing and treating, compressed natural gas (CNG) delivery, data analytics, related goods comprising sand mine operations, and technologies; and well site fueling and logistics. As of as of December 31, 2023, the company owned and operated a fleet of approximately 40 active hydraulic fracturing; and two sand mines in the Permian Basin. In addition, the company provides services primarily in the Permian Basin, the Williston Basin, the Eagle Ford Shale, the Haynesville Shale, the Appalachian Basin (Marcellus Shale and Utica Shale), the Western Canadian Sedimentary Basin, the Denver-Julesburg Basin (the DJ Basin), and the Anadarko Basin. Liberty Energy Inc. was formerly known as Liberty Oilfield Services Inc. and changed its name to Liberty Energy Inc. in April 2022. The company was founded in 2011 and is headquartered in Denver, Colorado.

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.