Baker Hughes (NASDAQ:BKR) & Pason Systems (OTCMKTS:PSYTF) Head-To-Head Analysis

Baker Hughes (NASDAQ:BKR) and Pason Systems (OTCMKTS:PSYTF) are both energy companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, earnings, analyst recommendations, risk, profitability, valuation and institutional ownership.

Dividends

Baker Hughes pays an annual dividend of $0.84 per share and has a dividend yield of 2.3%. Pason Systems pays an annual dividend of $0.47 per share and has a dividend yield of 4.7%. Baker Hughes pays out 46.9% of its earnings in the form of a dividend. Pason Systems pays out 44.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Pason Systems is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

92.1% of Baker Hughes shares are held by institutional investors. Comparatively, 46.7% of Pason Systems shares are held by institutional investors. 0.3% of Baker Hughes shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Baker Hughes and Pason Systems”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Baker Hughes	$27.03 billion	1.35	$1.94 billion	$1.79	20.36
Pason Systems	N/A	N/A	N/A	$1.07	9.37

Baker Hughes has higher revenue and earnings than Pason Systems. Pason Systems is trading at a lower price-to-earnings ratio than Baker Hughes, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Baker Hughes and Pason Systems’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Baker Hughes	7.37%	12.45%	5.25%
Pason Systems	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent recommendations and price targets for Baker Hughes and Pason Systems, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Baker Hughes	0	2	16	0	2.89
Pason Systems	0	0	0	0	N/A

Baker Hughes presently has a consensus target price of $43.59, suggesting a potential upside of 19.58%. Given Baker Hughes’ higher possible upside, equities research analysts clearly believe Baker Hughes is more favorable than Pason Systems.

Summary

Baker Hughes beats Pason Systems on 10 of the 12 factors compared between the two stocks.

About Baker Hughes

Baker Hughes Company provides a portfolio of technologies and services to energy and industrial value chain worldwide. The company operates through Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET) segments. The OFSE segment designs and manufactures products and provides related services, including exploration, appraisal, development, production, rejuvenation, and decommissioning for onshore and offshore oilfield operations. This segment also provides drilling services, drill bits, and drilling and completions fluids; completions, intervention, measurements, pressure pumping, and wireline services; artificial lift systems, and oilfield and industrial chemicals; subsea projects and services, flexible pipe systems, and surface pressure control systems; and integrated well services and solutions. It serves oil and natural gas companies; the United States and international independent oil and natural gas companies; national or state-owned oil companies; engineering, procurement, and construction contractors; geothermal companies; and other oilfield service companies. The IET segment provides gas technology equipment, including drivers, driven equipment, flow control, and turnkey solutions for the mechanical-drive, compression, and power-generation applications; and energy sectors, such as oil and gas, LNG operations, petrochemical, and carbon solutions. This segment also provides rack-based vibration monitoring equipment and sensors; integrated asset performance management products; inspection services; pumps, valves, and gears; precision sensors and instrumentation, and condition monitoring solutions. It serves upstream, midstream, downstream, onshore, offshore, and small and large scale customers. The company was formerly known as Baker Hughes, a GE company and changed its name to Baker Hughes Company in October 2019. Baker Hughes Company was incorporated in 2016 and is based in Houston, Texas.

About Pason Systems

Pason Systems Inc., together with its subsidiaries, provides instrumentation and data management systems for drilling rigs in Canada, the United States, and internationally. The company provides Electronic Drilling Recorder, which provides real-time drilling data to rig site personnel; DataHub with Pason Live, which is used as the central repository for data and reports captured at the rigs for real-time; and DataLink that provides automated in-house databases, third-party analytics platforms, remote geosteering, and other remote services. It offers AutoDriller to maximize the rate of penetration and bit life; internet solutions, such as auto-aiming satellite dishes, data modems, and bandwidth management software; DAS, a rotary drilling automation and optimization software; Electronic Choke Actuator that controls the choke valve; Gas Analyzer that provides real-time compositional gas analysis; Hazardous Gas Alarm System that detects the presence of hazardous gases; Pit Volume Totalizer, which monitors mud volumes and flow rates during drilling, tripping, and casing operations; and Toolface Control, a directional automation software. In addition, the company provides phone, chat, field, and drilling optimization support, as well as proactive monitoring and office support for data integration. It serves drilling contractors and other oilfield service companies. Pason Systems Inc. was founded in 1978 and is headquartered in Calgary, Canada.