Financial Comparison: Oceaneering International (NYSE:OII) and Kinetik (NYSE:KNTK)

Kinetik (NYSE:KNTK) and Oceaneering International (NYSE:OII) are both mid-cap energy companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, valuation, dividends, analyst recommendations and risk.

Institutional & Insider Ownership

21.1% of Kinetik shares are held by institutional investors. Comparatively, 93.9% of Oceaneering International shares are held by institutional investors. 3.6% of Kinetik shares are held by company insiders. Comparatively, 1.3% of Oceaneering International shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Kinetik has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500. Comparatively, Oceaneering International has a beta of 1.15, meaning that its share price is 15% more volatile than the S&P 500.

Valuation and Earnings

This table compares Kinetik and Oceaneering International”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kinetik	$1.76 billion	4.39	$525.93 million	$2.45	19.47
Oceaneering International	$2.80 billion	1.37	$353.76 million	$3.37	11.41

Kinetik has higher earnings, but lower revenue than Oceaneering International. Oceaneering International is trading at a lower price-to-earnings ratio than Kinetik, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Kinetik and Oceaneering International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kinetik	0	6	7	2	2.73
Oceaneering International	0	4	1	0	2.20

Kinetik currently has a consensus price target of $49.17, suggesting a potential upside of 3.07%. Oceaneering International has a consensus price target of $38.33, suggesting a potential downside of 0.30%. Given Kinetik’s stronger consensus rating and higher possible upside, equities analysts plainly believe Kinetik is more favorable than Oceaneering International.

Profitability

This table compares Kinetik and Oceaneering International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kinetik	28.58%	-36.36%	7.10%
Oceaneering International	12.12%	18.35%	7.12%

Dividends

Kinetik pays an annual dividend of $3.24 per share and has a dividend yield of 6.8%. Oceaneering International pays an annual dividend of $0.60 per share and has a dividend yield of 1.6%. Kinetik pays out 132.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Oceaneering International pays out 17.8% of its earnings in the form of a dividend. Kinetik has increased its dividend for 1 consecutive years. Kinetik is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Kinetik beats Oceaneering International on 11 of the 18 factors compared between the two stocks.

About Kinetik

Kinetik Holdings Inc. operates as a midstream company in the Texas Delaware Basin. It provides gathering, transportation, compression, processing, and treating services for companies that produce natural gas, natural gas liquids, crude oil, and water. The company is headquartered in Midland, Texas.

About Oceaneering International

Oceaneering International, Inc. provides engineered services and products, and robotic solutions to the offshore energy, defense, aerospace, manufacturing, and entertainment industries worldwide. It operates through Subsea Robotics, Manufactured Products, Offshore Projects Group, Integrity Management & Digital Solutions, and Aerospace and Defense Technologies segments. The company offers remotely operated vehicles (ROVs) for drill support and vessel-based services, including subsea hardware installation, construction, pipeline inspection, survey and facilities inspection, maintenance, and repair; ROV tooling; and survey services, such as hydrographic survey, positioning services, and autonomous underwater vehicles for geoscience. It also provides distribution and connection systems, including production control umbilicals and field development hardware, pipeline connection, and repair systems to the energy industry; and autonomous mobile robotic technology and entertainment systems to various industries. In addition, the company offers subsea installation and intervention, including riserless light well intervention inspection, maintenance, and repair services; installation and workover control systems, and ROV workover control systems; diving services; project management and engineering; and drill pipe riser services and systems, and wellhead load relief solutions. Further, it provides asset integrity management, software and analytical solutions for the bulk cargo maritime industry, and software, digital, and connectivity solutions for the energy industry, as well as government services and products, including engineering and related manufacturing in defense and space exploration activities to the United States' government agencies and their prime contractors. Oceaneering International, Inc. was founded in 1964 and is headquartered in Houston, Texas.