Tenaris (NYSE:TS) and NOV (NYSE:NOV) Critical Analysis

Tenaris (NYSE:TS) and NOV (NYSE:NOV) are both energy companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, profitability, earnings, institutional ownership, risk, dividends and valuation.

Earnings and Valuation

This table compares Tenaris and NOV”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tenaris	$12.04 billion	2.50	$1.93 billion	$3.74	15.04
NOV	$8.74 billion	0.84	$145.00 million	$0.26	79.24

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

Analyst Ratings

This is a summary of current ratings for Tenaris and NOV, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tenaris	0	6	4	0	2.40
NOV	2	9	5	0	2.19

Tenaris currently has a consensus price target of $62.45, indicating a potential upside of 11.02%. NOV has a consensus price target of $21.31, indicating a potential upside of 3.42%. Given Tenaris’ stronger consensus rating and higher possible upside, equities analysts plainly believe Tenaris is more favorable than NOV.

Insider & Institutional Ownership

10.4% of Tenaris shares are held by institutional investors. Comparatively, 93.3% of NOV shares are held by institutional investors. 0.2% of Tenaris shares are held by insiders. Comparatively, 1.1% of NOV shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Tenaris and NOV’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tenaris	15.88%	11.14%	9.40%
NOV	1.10%	3.44%	1.94%

Dividends

Tenaris pays an annual dividend of $2.36 per share and has a dividend yield of 4.2%. NOV pays an annual dividend of $0.36 per share and has a dividend yield of 1.7%. Tenaris pays out 63.1% of its earnings in the form of a dividend. NOV pays out 138.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NOV has raised its dividend for 1 consecutive years. Tenaris is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Tenaris has a beta of 0.85, meaning that its share price is 15% less volatile than the S&P 500. Comparatively, NOV has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500.

Summary

Tenaris beats NOV on 11 of the 17 factors compared between the two stocks.

About Tenaris

Tenaris S.A., together with its subsidiaries, produces and sells seamless and welded steel tubular products and related services for the oil and gas industry, and other industrial applications. The company offers steel casings, tubing products, mechanical and structural pipes, line pipes, cold-drawn pipes, and premium joints and couplings; and coiled tubing products for oil and gas drilling and workovers, and subsea pipelines. It also manufactures sucker rods used in oil extraction activities and tubes for plumbing and construction applications; and offers oilfield/hydraulic fracturing services and energy and raw materials, and financial services. The company operates in North America, South America, Europe, the Middle East and Africa, and the Asia Pacific. Tenaris S.A. was founded in 2001 and is based in Luxembourg. Tenaris S.A. operates as a subsidiary of Techint Holdings S.à r.l.

About NOV

NOV Inc. designs, constructs, manufactures, and sells systems, components, and products for oil and gas drilling and production, and industrial and renewable energy sectors in the United States and internationally. It operates through two segments, Energy Equipment, and Energy Products and Services. The company provides solids control and waste management equipment and services, managed pressure drilling, drilling fluids, premium drillpipe, wired pipe, drilling optimization services, tubular inspection and coating services, instrumentation, downhole tools, and drill bits. It also offers equipment and technologies for hydraulic fracture stimulation, including downhole multistage fracturing tools, pressure pumping trucks, blenders, sanders, hydration and injection units, flowline, and manifolds; coiled tubing units, and wireline units and tools; connections and liner hangers; onshore production consists of composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems; and offshore production, such as floating production systems and subsea production technologies, as well as manufactures industrial pumps and mixers. In addition, the company provides substructures, derricks, and masts; cranes; jacking systems; pipe lifting, racking, rotating, and assembly systems; mud pumps; pressure control equipment; drives and generators; rig instrumentation and control systems; mooring, anchor, and deck handling machinery; equipment components for offshore wind construction vessels; and pipelay and construction systems. Further, the company offers spare parts, repair, and rentals as well as comprehensive remote equipment monitoring, technical support, field service, and customer training. The company was formerly known as National Oilwell Varco, Inc. and changed its name to NOV Inc. in January 2021. NOV Inc. was founded in 1862 and is based in Houston, Texas.