PDS

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Precision Drilling: A Bright Future Awaits For This Canadian Driller

complete article---

http://seekingalpha.com/article/1936891 ... e_readmore

Conclusion

Precision Drilling's growth has stalled since 2012 as the company has reported shrinking revenues and declining earnings. The business, however, now appears to be on the verge of a turnaround and has shown clear signs of improvement (higher drilling rig revenues per utilization day and sequential improvements in active rig count). Furthermore, Precision Drilling's market share and its high-performance rig-mix puts it in a good position to capitalize on the expected changes in the industry conditions coming from the LNG development at the west coast.

For these reasons, I am bullish on Precision Drilling and I believe the current dip was an attractive opportunity for long term investors. The company's shares are still attractive as they are hovering around $9.15, which is below the pre-AIM sale announcement level of $9.62. Analysts at Jefferies and Raymond James have recently upgraded the stock with a price target of $11 and $11.50 respectively.

[dan_s]

PDS is a first class company. My current valuation is $10.75, based on only 5X CFPS. That is a low multiple for a company of this quality. PDS is very well respected in Canada.

I now think PDS Q4 earnings per share will beat the First Call estimate of $0.17.

Improving natural gas prices are good news for Canadian oilfield service firms.

PDS also has a lot of rigs in the U.S.