Contrasting Drilling Tools International (NASDAQ:DTI) and Innovex International (NYSE:INVX)

Innovex International (NYSE:INVX) and Drilling Tools International (NASDAQ:DTI) are both small-cap oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, institutional ownership, valuation and dividends.

Risk and Volatility

Innovex International has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500. Comparatively, Drilling Tools International has a beta of -0.86, meaning that its stock price is 186% less volatile than the S&P 500.

Earnings and Valuation

This table compares Innovex International and Drilling Tools International”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Innovex International	$550.34 million	2.35	$600,000.00	$1.41	13.62
Drilling Tools International	$149.79 million	0.75	$14.75 million	$0.28	11.21

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

Insider & Institutional Ownership

2.8% of Drilling Tools International shares are held by institutional investors. 3.1% of Innovex International shares are held by company insiders. Comparatively, 14.7% of Drilling Tools International shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings for Innovex International and Drilling Tools International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Innovex International	1	0	0	1	2.50
Drilling Tools International	0	0	1	0	3.00

Innovex International presently has a consensus price target of $15.00, suggesting a potential downside of 21.92%. Drilling Tools International has a consensus price target of $5.50, suggesting a potential upside of 75.16%. Given Drilling Tools International’s stronger consensus rating and higher possible upside, analysts clearly believe Drilling Tools International is more favorable than Innovex International.

Profitability

This table compares Innovex International and Drilling Tools International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Innovex International	12.31%	-0.73%	-0.61%
Drilling Tools International	5.46%	15.38%	8.89%

Summary

Drilling Tools International beats Innovex International on 8 of the 15 factors compared between the two stocks.

About Innovex International

Innovex International, Inc. engages in the provision of solutions for both onshore and offshore applications within the oil and gas industry. The company was founded on September 15, 2016 and is headquartered in Humble, TX.

About Drilling Tools International

Drilling Tools International Corporation provides oilfield equipment and services to oil and natural gas sectors in North America, Europe, and the Middle East. It offers downhole tool rentals, machining, and inspection services to support the global drilling and wellbore construction industry. The company also provides products are bottom hole assembly components, such as stabilizers, subs, non-magnetic and steel drill collars, hole openers, and roller reamers, as well as drill pipe and drill pipe accessories; ancillary equipment and handling tools to support its rental platform, including float valves, ring gauges, tool baskets, lift bail, lift subs, mud magnets, elevators, bracket and bail assemblies, slips, tongs, stabbing guides and safety clamps; and blowout preventers, and pressure control accessory equipment. In addition, it offers tool rental services, which consists of rental, inspection, machining, and repair services; rents downhole drilling tools used in horizontal and directional drilling of oil and natural gas; rents kellys, pip joints, work strings; maintains a fleet of rental equipment consisting of drill collars, stabilizers, crossover subs, wellbore conditioning tools, drill pipe, hevi-wate drill pipe, and tubing; rents surface control equipment, such as blowout preventers and handling tools; and provides downhole products for producing wells. Drilling Tools International Corporation is headquartered in Houston, Texas.