Analyzing Valaris (OTCMKTS:VALPQ) & Infinity Energy Resources (OTCMKTS:IFNY)

Infinity Energy Resources (OTCMKTS:IFNY) and Valaris (OTCMKTS:VALPQ) are both small-cap oils/energy companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, dividends, analyst recommendations and earnings.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Infinity Energy Resources and Valaris, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Infinity Energy Resources 0 0 0 0 N/A
Valaris 1 0 0 0 1.00

Valaris has a consensus price target of $0.06, suggesting a potential downside of 31.58%. Given Valaris’ higher possible upside, analysts plainly believe Valaris is more favorable than Infinity Energy Resources.

Earnings & Valuation

This table compares Infinity Energy Resources and Valaris’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Infinity Energy Resources N/A N/A $1.85 million N/A N/A
Valaris $2.05 billion 0.01 -$198.00 million ($5.83) -0.02

Infinity Energy Resources has higher earnings, but lower revenue than Valaris.

Risk and Volatility

Infinity Energy Resources has a beta of 2.35, suggesting that its stock price is 135% more volatile than the S&P 500. Comparatively, Valaris has a beta of 2.54, suggesting that its stock price is 154% more volatile than the S&P 500.

Profitability

This table compares Infinity Energy Resources and Valaris’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Infinity Energy Resources N/A -14.55% -1,445.20%
Valaris -237.15% -15.28% -7.57%

Institutional & Insider Ownership

62.2% of Valaris shares are held by institutional investors. 10.5% of Infinity Energy Resources shares are held by company insiders. Comparatively, 0.5% of Valaris shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Valaris beats Infinity Energy Resources on 5 of the 9 factors compared between the two stocks.

About Infinity Energy Resources

Infinity Energy Resources, Inc., an independent energy company, focuses on the exploration and development of oil and gas resources. It holds 100% interests in the Perlas Block, which covers an area of approximately 560,000 acres/2,268 kilometers; and the Tyra Block that covers an area of 826,000 acres/3,342 kilometers located in shallow waters offshore Nicaragua in the Caribbean Sea. The company was founded in 1987 and is based in Overland Park, Kansas.

About Valaris

Valaris plc provides offshore drilling services in various water depths worldwide. It operates a rig fleet of ultra-deepwater drillships, versatile semisubmersibles, and modern shallow-water jackups. The company's offshore fleet includes 16 drillships, 12 semisubmersibles, 54 jackups, and 2 deepwater managed units. The company was formerly known as Ensco Rowan plc and changed its name to Valaris plc in July 2019. Valaris plc was incorporated in 2009 and is based in London, the United Kingdom. On August 19, 2020, Valaris plc, along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas.

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