When I went to work in public accounting way back in 1976, my first assignment was working on the tax return for HP.
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Read this: https://oilprice.com/Energy/Crude-Oil/W ... rkets.html
Top Pick for Drillers: HP and PTEN
Top Pick for Drillers: HP and PTEN
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Top Pick for Drillers: HP and PTEN
Raymond James' Top Picks for 2023 includes PTEN
From RJ 1-3-2023
"We have only recently relaunched our inital coverage in the OFS sector, starting with six names. We will be ramping up coverage over the course of 2023. Of those six names, we have three rated at Strong Buy and three rated at Outperform. Our favorite large cap Strong Buy-rated name is Halliburton (HAL), which based on both our and consensus estimates has comparable top-line and EBITDA growth rates over the 2022-2025 timeframe, has meaningful exposure to the strong current NAM market and international growth rates yet trades at a discount to both its peers and historical multiples. NexTier OFS (NEX) was our Strong Buy-rated FCF/value pick given our expectation of another strong year of margins and continued activity (sold out for 2023), with a recently implemented $250 million share buyback program (~50% of projected FCF though 2023), while trading at ~3.0x EV/EBITDA. Finally, Patterson-UTI (PTEN) is our Strong Buy-rated U.S. land drilling name that similar to NEX has a strong EBITDA growth/FCF generation outlook for 2023, while trading at a discounted multiple and despite doubling its dividend and implementing a $300 million share repurchase program last quarter. We certainly like other names/subsectors, but will refrain from recommendations until we’ve had a chance to fill out our coverage."
From RJ 1-3-2023
"We have only recently relaunched our inital coverage in the OFS sector, starting with six names. We will be ramping up coverage over the course of 2023. Of those six names, we have three rated at Strong Buy and three rated at Outperform. Our favorite large cap Strong Buy-rated name is Halliburton (HAL), which based on both our and consensus estimates has comparable top-line and EBITDA growth rates over the 2022-2025 timeframe, has meaningful exposure to the strong current NAM market and international growth rates yet trades at a discount to both its peers and historical multiples. NexTier OFS (NEX) was our Strong Buy-rated FCF/value pick given our expectation of another strong year of margins and continued activity (sold out for 2023), with a recently implemented $250 million share buyback program (~50% of projected FCF though 2023), while trading at ~3.0x EV/EBITDA. Finally, Patterson-UTI (PTEN) is our Strong Buy-rated U.S. land drilling name that similar to NEX has a strong EBITDA growth/FCF generation outlook for 2023, while trading at a discounted multiple and despite doubling its dividend and implementing a $300 million share repurchase program last quarter. We certainly like other names/subsectors, but will refrain from recommendations until we’ve had a chance to fill out our coverage."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group