North American Construction Group (NYSE:NOA) & Subsea 7 (OTC:SUBCY) Critical Comparison

Subsea 7 (OTC:SUBCY) and North American Construction Group (NYSE:NOA) are both energy companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, profitability, analyst recommendations, valuation, institutional ownership, dividends and risk.

Insider & Institutional Ownership

0.0% of Subsea 7 shares are held by institutional investors. Comparatively, 75.0% of North American Construction Group shares are held by institutional investors. 1.0% of Subsea 7 shares are held by company insiders. Comparatively, 9.7% of North American Construction Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Subsea 7 pays an annual dividend of $1.16 per share and has a dividend yield of 8.2%. North American Construction Group pays an annual dividend of $0.33 per share and has a dividend yield of 2.2%. Subsea 7 pays out 173.1% 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 Construction Group pays out 28.7% of its earnings in the form of a dividend.

Risk and Volatility

Subsea 7 has a beta of 1.38, indicating that its share price is 38% more volatile than the S&P 500. Comparatively, North American Construction Group has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Subsea 7 and North American Construction Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Subsea 7	0	1	0	0	2.00
North American Construction Group	0	0	1	2	3.67

Profitability

This table compares Subsea 7 and North American Construction Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Subsea 7	2.46%	3.72%	1.98%
North American Construction Group	4.79%	26.00%	6.03%

Earnings & Valuation

This table compares Subsea 7 and North American Construction Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Subsea 7	$5.97 billion	0.72	$15.40 million	$0.67	21.19
North American Construction Group	$1.17 billion	0.40	$46.78 million	$1.15	13.33

North American Construction Group has lower revenue, but higher earnings than Subsea 7. North American Construction Group is trading at a lower price-to-earnings ratio than Subsea 7, indicating that it is currently the more affordable of the two stocks.

Summary

North American Construction Group beats Subsea 7 on 11 of the 16 factors compared between the two stocks.

About Subsea 7

Subsea 7 S.A. delivers offshore projects and services for the energy industry worldwide. It provides subsea field development products and services, including project management, design and engineering, procurement, fabrication, survey, installation, and commissioning of production facilities on the seabed and the tie-back of its facilities to fixed or floating platforms or to the shore. The company also offers engineering, procurement, commissioning, and installation of subsea umbilicals, risers, and flowlines; inspection, repair, maintenance, remote intervention, and integrity management of subsea infrastructure services; conventional services comprising fabrication, installation, extension, and refurbishment of fixed and floating platforms and associated pipelines in shallow water; and hook-up services. In addition, it operates heavy lifting operations and heavy transportation services for renewables structures; and installs offshore wind turbine foundations, as well as engages in the decommissioning of redundant offshore structures. Further, the company provides remotely operated vehicles (ROVs) and tooling services to support exploration and production activities, as well as engineering and advisory services for customers in the oil and gas, renewables, and utilities industries. The company was incorporated in 1993 and is based in Luxembourg, Luxembourg.

About North American Construction Group

North American Construction Group Ltd. provides mining and heavy civil construction services to customers in the resource development and industrial construction sectors in Australia, Canada, and the United States. The company operates Heavy Equipment – Canada, Heavy Equipment – Australia, and Other segments. It also offers mine management services for thermal coal mines; and construction and operations support services in the Canadian oil sands region. In addition, the company provides fully maintained heavy equipment rentals and full service mine operations support at metallurgical and thermal coal mines; heavy equipment rentals to iron ore, gold and lithium producers; and heavy equipment maintenance, component remanufacturing, and full equipment rebuild services to mining companies and other heavy equipment operators, as well as supplies production-critical components to the mining and construction industry. As of December 31, 2023, it operated a heavy equipment fleet of 900 units. The company was formerly known as North American Energy Partners Inc. and changed its name to North American Construction Group Ltd. in April 2018. North American Construction Group Ltd. was incorporated in 1953 and is headquartered in Acheson, Canada.