Financial Analysis: Petrofac (OTCMKTS:POFCY) versus Flotek Industries (NYSE:FTK)

Petrofac (OTCMKTS:POFCY) and Flotek Industries (NYSE:FTK) are both small-cap energy companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, valuation and dividends.

Valuation & Earnings

This table compares Petrofac and Flotek Industries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Petrofac	$2.50 billion	0.00	-$505.00 million	N/A	N/A
Flotek Industries	$237.26 million	3.13	$30.53 million	$0.78	26.28

Flotek Industries has lower revenue, but higher earnings than Petrofac.

Profitability

This table compares Petrofac and Flotek Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Petrofac	N/A	N/A	N/A
Flotek Industries	11.83%	20.70%	10.23%

Institutional and Insider Ownership

10.9% of Flotek Industries shares are held by institutional investors. 2.4% of Flotek Industries shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Petrofac has a beta of 2.2, suggesting that its share price is 120% more volatile than the S&P 500. Comparatively, Flotek Industries has a beta of 1.39, suggesting that its share price is 39% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for Petrofac and Flotek Industries, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Petrofac	0	0	0	0	0.00
Flotek Industries	0	1	4	0	2.80

Flotek Industries has a consensus price target of $21.33, suggesting a potential upside of 4.06%. Given Flotek Industries’ stronger consensus rating and higher possible upside, analysts plainly believe Flotek Industries is more favorable than Petrofac.

Summary

Flotek Industries beats Petrofac on 9 of the 11 factors compared between the two stocks.

About Petrofac

Petrofac Limited designs, builds, manages, and maintains infrastructure for the energy industries in the United Kingdom, Algeria, Thailand, Oman, Kuwait, Iraq, the United Arab Emirates, the Netherlands, and internationally. It operates through three segments: Engineering & Construction (E&C); Asset Solutions; and Integrated Energy Services (IES). The E&C segment provides onshore and offshore engineering, procurement, construction, installation, and commissioning services. The Asset Solutions segment offers concept, feasibility, and front-end engineering design services, as well as manages and maintains onshore and offshore operations. The IES segment focuses on delivering value from the existing asset portfolio. The company was founded in 1981 and is based in St Helier, Jersey.

About Flotek Industries

Flotek Industries, Inc. operates as a technology-driven green chemistry and data company that serves customers across industrial and commercial markets in the United States, the United Arab Emirates, and internationally. It operates through two segments: Chemistry Technologies (CT) and Data Analytics (DA). The CT segment designs, develops, manufactures, packages, distributes, delivers, and markets green specialty chemicals that enhance the profitability of hydrocarbon producers, as well as green specialty chemistries, and logistics and technology services. This segment primarily serves integrated oil and gas, oilfield services, independent oil and gas, national and state-owned oil, geothermal energy, solar energy, and alternative energy companies. The DA segment designs, develops, produces, sells, and supports equipment and services that create and provide valuable information on the composition and properties of energy customers' hydrocarbon fluids. It sells its products directly through a mix of in-house sales professionals, as well as contractual agency agreements. Flotek Industries, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.