Cactus (NYSE:WHD – Get Free Report) and Kodiak Gas Services (NYSE:KGS – Get Free Report) are both mid-cap energy companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, analyst recommendations, institutional ownership and dividends.
Earnings and Valuation
This table compares Cactus and Kodiak Gas Services”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Cactus | $1.08 billion | 5.17 | $166.01 million | $1.17 | 59.47 |
| Kodiak Gas Services | $1.31 billion | 4.95 | $80.52 million | $0.84 | 76.28 |
Dividends
Cactus pays an annual dividend of $0.60 per share and has a dividend yield of 0.9%. Kodiak Gas Services pays an annual dividend of $1.96 per share and has a dividend yield of 3.1%. Cactus pays out 51.3% of its earnings in the form of a dividend. Kodiak Gas Services pays out 233.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Cactus has increased its dividend for 4 consecutive years and Kodiak Gas Services has increased its dividend for 2 consecutive years.
Institutional and Insider Ownership
85.1% of Cactus shares are owned by institutional investors. Comparatively, 24.9% of Kodiak Gas Services shares are owned by institutional investors. 12.9% of Cactus shares are owned by company insiders. Comparatively, 0.6% of Kodiak Gas Services shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Profitability
This table compares Cactus and Kodiak Gas Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Cactus | 6.01% | 16.66% | 10.81% |
| Kodiak Gas Services | 5.77% | 11.92% | 3.70% |
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Cactus and Kodiak Gas Services, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Cactus | 0 | 4 | 3 | 0 | 2.43 |
| Kodiak Gas Services | 0 | 2 | 10 | 0 | 2.83 |
Cactus presently has a consensus price target of $66.80, suggesting a potential downside of 4.00%. Kodiak Gas Services has a consensus price target of $78.89, suggesting a potential upside of 23.12%. Given Kodiak Gas Services’ stronger consensus rating and higher probable upside, analysts plainly believe Kodiak Gas Services is more favorable than Cactus.
Risk & Volatility
Cactus has a beta of 1.37, suggesting that its stock price is 37% more volatile than the S&P 500. Comparatively, Kodiak Gas Services has a beta of 0.96, suggesting that its stock price is 4% less volatile than the S&P 500.
Summary
Cactus beats Kodiak Gas Services on 11 of the 17 factors compared between the two stocks.
About Cactus
Cactus, Inc., together with its subsidiaries, designs, manufactures, sells, and leases pressure control and spoolable pipes in the United States, Australia, Canada, the Middle East, and internationally. It operates through two segments, Pressure Control and Spoolable Technologies. The Pressure Control segment designs, manufactures, sells, and rents a range of wellhead and pressure control equipment under the Cactus Wellhead brand name through service centers. Its products are sold and rented primarily for onshore unconventional oil and gas wells for drilling, completion, and production phases of the wells. This segment also provides field services to install, maintain, and handle the equipment. The Spoolable Technologies segment designs, manufactures, and sells spoolable pipes and associated end fittings under the FlexSteel brand name. Its products are primarily used to transport oil, gas, and other liquids. This segment also provides field services and rental items through service centers and pipe yards, as well as offers equipment and services internationally. In addition, the company offers repair and refurbishment services. Cactus, Inc. was founded in 2011 and is headquartered 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.
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