Smart Sand (NASDAQ:SND) versus Precision Drilling (NYSE:PDS) Critical Contrast

Precision Drilling (NYSE:PDS) and Smart Sand (NASDAQ:SND) are both small-cap energy companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, dividends, earnings, valuation and risk.

Profitability

This table compares Precision Drilling and Smart Sand’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Precision Drilling	-1.68%	2.11%	1.24%
Smart Sand	2.71%	4.41%	3.07%

Institutional & Insider Ownership

48.9% of Precision Drilling shares are owned by institutional investors. Comparatively, 35.2% of Smart Sand shares are owned by institutional investors. 0.9% of Precision Drilling shares are owned by insiders. Comparatively, 33.5% of Smart Sand shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Precision Drilling and Smart Sand, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Precision Drilling	1	2	4	1	2.62
Smart Sand	0	0	1	0	3.00

Precision Drilling currently has a consensus price target of $122.33, indicating a potential upside of 43.49%. Given Precision Drilling’s higher possible upside, equities analysts plainly believe Precision Drilling is more favorable than Smart Sand.

Earnings and Valuation

This table compares Precision Drilling and Smart Sand”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Precision Drilling	$1.92 billion	0.56	$1.32 million	($2.09)	-40.79
Smart Sand	$386.99 million	0.56	$1.35 million	$0.26	19.50

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

Risk & Volatility

Precision Drilling has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500. Comparatively, Smart Sand has a beta of 0.36, suggesting that its share price is 64% less volatile than the S&P 500.

Summary

Smart Sand beats Precision Drilling on 8 of the 15 factors compared between the two stocks.

About Precision Drilling

Precision Drilling Corporation, a drilling company, provides onshore drilling, completion, and production services to exploration and production companies in the oil and natural gas and geothermal industries in North America and the Middle East. The company operates through Contract Drilling Services and Completion and Production Services segments. The Contract Drilling Services segment offers onshore well drilling services to exploration and production companies in the geothermal, oil and natural gas industry. This segment offers services include land and turnkey drilling; and procurement and distribution of oilfield supplies, as well as manufacture and repair of drilling and service rig equipment. In addition, it operates land drilling rigs in Canada, the United States, and the Middle East, as well as operates AlphaAutomation, AlphaApps, and AlphaAnalytics data services. The company offers EverGreen suite of environmental solutions comprising EverGreenMonitoring, EverGreenEnergy, and EverGreen Fuel Cell. The Completion and Production Services segment provides service rigs for well completion, workover, abandonment, maintenance, and re-entry preparation services; equipment rentals; and camp and catering services to oil and natural gas exploration and production companies. This segment operates well completion and workover service rigs in Canada and the United States. Precision Drilling Corporation was founded in 1951 and is headquartered in Calgary, Canada.

About Smart Sand

Smart Sand, Inc., an integrated frac and industrial sand supply and services company, engages in the excavation, processing, and sale of sands or proppant for use in hydraulic fracturing operations in the oil and gas industry in the United States. It also provides proppant logistics services; and wellsite storage solutions through SmartSystems products and services. The company sells its products primarily to oil and natural gas exploration and production companies, oilfield service companies, and industrial manufacturers. Smart Sand, Inc. was incorporated in 2011 and is headquartered in Spring, Texas.