NOV (NYSE:NOV) versus Kodiak Gas Services (NYSE:KGS) Financial Review

NOV (NYSE:NOV) and Kodiak Gas Services (NYSE:KGS) are both mid-cap energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitability, institutional ownership, earnings, valuation and dividends.

Analyst Recommendations

This is a summary of current ratings and recommmendations for NOV and Kodiak Gas Services, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NOV	3	8	7	0	2.22
Kodiak Gas Services	0	1	9	0	2.90

NOV presently has a consensus target price of $16.5625, suggesting a potential upside of 33.51%. Kodiak Gas Services has a consensus target price of $41.10, suggesting a potential upside of 14.25%. Given NOV’s higher possible upside, equities research analysts clearly believe NOV is more favorable than Kodiak Gas Services.

Dividends

NOV pays an annual dividend of $0.30 per share and has a dividend yield of 2.4%. Kodiak Gas Services pays an annual dividend of $1.80 per share and has a dividend yield of 5.0%. NOV pays out 24.6% of its earnings in the form of a dividend. Kodiak Gas Services pays out 200.0% 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 and Kodiak Gas Services has raised its dividend for 2 consecutive years. Kodiak Gas Services is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

NOV has a beta of 1.32, indicating that its share price is 32% more volatile than the S&P 500. Comparatively, Kodiak Gas Services has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Profitability

This table compares NOV and Kodiak Gas Services’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NOV	5.36%	7.25%	4.15%
Kodiak Gas Services	6.48%	10.35%	3.20%

Institutional & Insider Ownership

93.3% of NOV shares are owned by institutional investors. Comparatively, 25.0% of Kodiak Gas Services shares are owned by institutional investors. 2.1% of NOV shares are owned by insiders. Comparatively, 0.3% of Kodiak Gas Services shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares NOV and Kodiak Gas Services”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NOV	$8.79 billion	0.52	$635.00 million	$1.22	10.17
Kodiak Gas Services	$1.16 billion	2.72	$49.90 million	$0.90	39.97

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

Summary

Kodiak Gas Services beats NOV on 9 of the 17 factors compared between the two stocks.

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.

About Kodiak Gas Services

Kodiak Gas Services, Inc. operates contract compression infrastructure for customers in the oil and gas industry in the United States. It operates in two segments, Compression Operations and Other Services. The Compression Operations segment operates company-owned and customer-owned compression infrastructure to enable the production, gathering, and transportation of natural gas and oil. The Other Services segment provides a range of contract services, including station construction, maintenance and overhaul, and other ancillary time and material-based offerings. The company was formerly known as Frontier TopCo, Inc. Kodiak Gas Services, Inc. was founded in 2010 and is headquartered in The Woodlands, Texas.