Contrasting ProFrac (NASDAQ:ACDC) & Archrock (NYSE:AROC)

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

Risk and Volatility

Archrock has a beta of 1.11, meaning that its share price is 11% more volatile than the S&P 500. Comparatively, ProFrac has a beta of 1.66, meaning that its share price is 66% more volatile than the S&P 500.

Earnings and Valuation

This table compares Archrock and ProFrac”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Archrock	$1.44 billion	2.86	$172.23 million	$1.50	15.64
ProFrac	$2.19 billion	0.31	-$215.10 million	($1.74)	-2.13

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

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Archrock	0	1	7	1	3.00
ProFrac	5	2	0	0	1.29

Archrock currently has a consensus target price of $31.50, indicating a potential upside of 34.26%. ProFrac has a consensus target price of $5.80, indicating a potential upside of 56.76%. Given ProFrac’s higher probable upside, analysts clearly believe ProFrac is more favorable than Archrock.

Insider and Institutional Ownership

95.4% of Archrock shares are held by institutional investors. Comparatively, 12.8% of ProFrac shares are held by institutional investors. 2.6% of Archrock shares are held by insiders. Comparatively, 2.6% of ProFrac shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Archrock and ProFrac’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Archrock	18.43%	20.40%	6.81%
ProFrac	-16.86%	-32.01%	-11.17%

Summary

Archrock beats ProFrac on 11 of the 15 factors compared between the two stocks.

About Archrock

Archrock, Inc., together with its subsidiaries, operates as an energy infrastructure company in the United States. The company operates in two segments, Contract Operations and Aftermarket Services. It engages in the designing, sourcing, owning, installing, operating, servicing, repairing, and maintaining of its owned fleet of natural gas compression equipment to provide natural gas compression services. The company also sells over-the-counter parts and components; and provides operations, major and routine maintenance, overhaul, and reconfiguration services to customers who own compression equipment. It serves integrated and independent oil and natural gas processors, gatherers, and transporters. The company was formerly known as Exterran Holdings, Inc. and changed its name to Archrock, Inc. in November 2015. Archrock, Inc. was founded in 1990 and is headquartered in Houston, Texas.

About ProFrac

ProFrac Holding Corp. operates as a technology-focused energy services holding company in the United States. It operates through three segments: Stimulation Services, Manufacturing, and Proppant Production. The company offers hydraulic fracturing, well stimulation, in-basin frac sand, and other completion services and complementary products and services to upstream oil and natural gas companies engaged in the exploration and production of unconventional oil and natural gas resources. It also manufactures and sells high horsepower pumps, valves, piping, swivels, large-bore manifold systems, and fluid ends. ProFrac Holding Corp. was founded in 2016 and is headquartered in Willow Park, Texas.