North American Energy Partners (NOA) versus Profire Energy (PFIE) Critical Review

North American Energy Partners (NYSE: NOA) and Profire Energy (NASDAQ:PFIE) are both small-cap oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, profitabiliy, analyst recommendations, institutional ownership, earnings, valuation and risk.

Profitability

This table compares North American Energy Partners and Profire Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
North American Energy Partners 1.13% 1.57% 0.73%
Profire Energy 2.85% 1.57% 1.51%

Volatility & Risk

North American Energy Partners has a beta of 0.51, meaning that its share price is 49% less volatile than the S&P 500. Comparatively, Profire Energy has a beta of 1.55, meaning that its share price is 55% more volatile than the S&P 500.

Valuation & Earnings

This table compares North American Energy Partners and Profire Energy’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
North American Energy Partners $168.84 million 0.73 $37.55 million $0.06 75.00
Profire Energy $24.60 million 2.65 $2.27 million $0.01 130.13

North American Energy Partners has higher revenue and earnings than Profire Energy. North American Energy Partners is trading at a lower price-to-earnings ratio than Profire Energy, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

47.7% of North American Energy Partners shares are held by institutional investors. Comparatively, 19.9% of Profire Energy shares are held by institutional investors. 51.1% of Profire Energy shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

North American Energy Partners pays an annual dividend of $0.06 per share and has a dividend yield of 1.3%. Profire Energy does not pay a dividend. North American Energy Partners pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. North American Energy Partners has increased its dividend for 2 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and price targets for North American Energy Partners and Profire Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
North American Energy Partners 0 0 3 0 3.00
Profire Energy 0 0 1 0 3.00

North American Energy Partners presently has a consensus target price of $9.00, indicating a potential upside of 100.00%. Profire Energy has a consensus target price of $2.15, indicating a potential upside of 65.38%. Given North American Energy Partners’ higher probable upside, equities analysts plainly believe North American Energy Partners is more favorable than Profire Energy.

Summary

North American Energy Partners beats Profire Energy on 8 of the 15 factors compared between the two stocks.

North American Energy Partners Company Profile

North American Energy Partners Inc. provides a range of mining and heavy construction services to customers in the resource development and industrial construction sectors within Western Canada. The Company’s operating divisions include Heavy Construction and Mining; Industrial, and Tailings & Environmental Construction. Its Heavy Construction and Mining division is engaged in hard rock and oil sands mining, overburden removal, mine site development and mine reclamation. Its Industrial division offers services, which include site development, installation of underground utilities and piping, concrete foundations, facilities and infrastructure construction, and design/build services. The Tailings & Environmental Construction division performs a range of tailings, reclamation and environmental construction services, including oil sands tailings remediation; management of mine tailings; tailings dam and dyke construction, pipeline co-corridor construction, and tailings pipelines.

Profire Energy Company Profile

Profire Energy, Inc. is an oilfield technology company. The Company is primarily engaged in the business of developing combustion management technologies for the oil and gas industry. It specializes in the creation of burner-management systems, used on a range of oilfield natural-draft fire tube vessels. It offers burner-management systems, which help to ignite, monitor and manage the burner flame. Its solution, the PF3100, helps manage and synchronize custom applications helping oilfield producers meet deadlines through an off-the-shelf solution with dynamic customization. It also sells complementary oilfield products. Such products help manage fuel flow (such as valves and fuel trains), meter air flow (such as airplates), generate power on-site (such as solar packages), ignite and direct flame (such as flare stack igniter and nozzles), and other functions. In addition to the burner-management systems and complementary technologies, it also offers chemical-management systems.

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