Patterson-UTI Energy (PTEN - Free Report) reported a third-quarter 2022 adjusted net profit of 28 cents per share, beating the Zacks Consensus Estimate of a profit of 19 cents. This outperformance can be attributed to third-quarter revenues beating the consensus mark due to solid segmental performances.
Moreover, the profit beat the year-ago quarter's loss of 44 cents per share on accelerated rig activity and much higher energy prices.
The company’s total quarterly revenues of $727.5 million outperformed the Zacks Consensus Estimate of $684 million. Moreover, the top line improved by an impressive 103.3% on a year-over-year basis.
In good news for investors, Patterson-UTI doubled its quarterly cash dividend to 8 cents per share from the previous 4-cent payout. The dividend will be paid out on Dec 15, 2022 to shareholders of record as of Dec 1, 2022. Moreover, PTEN also increased its share repurchase authorization to $300 million.
Segmental Performances
Contract Drilling: Revenues totaled $356 million, up by 125.5% from the last year’s third-quarter figure of $157.9 million due to continued day rate pricing momentum, contract renewals and increasing activity.
The unit posted an operating profit of $43.3 million in the third quarter, outperforming the year-ago loss of $51.8 million due to favorable pricing.
Pressure Pumping: Revenues of $287.7 million rose about 88.5% from the year-ago figure of $152.6 million due to better pricing.
Moreover, the segment posted an operating profit of $48.9 million compared to a loss of $13.7 million in the third quarter of 2021. The profit is attributable to active spreads being highly utilized in the reported quarter and better customer pricing.
Directional Drilling: Revenues summed at $58.9 million, up 85.5% year over year from the last year’s figure of $31.7 million due to higher activity and more favorable pricing. Moreover, the segment posted an operating profit of $4.4 million against a loss of $4.6 million reported in the corresponding quarter of 2021.
Other Operations: Revenues were $24.9 million, up about 59.8% more than the year-ago quarter’s $15.6 million as activity levels improved. The unit also posted a quarterly profit of $2.6 million compared to a loss of $1.3 million recorded in the year-ago quarter.
Capital Expenditure & Financial Position
In the third quarter of 2022, PTEN spent $126.35 million on capital programs (compared with $34.26 million in the third quarter of 2021). As of Sep 30, 2022, the company had $42.7 million of cash and cash equivalents and $852.9 million as long-term debt.
Outlook
For the fourth quarter, Patterson-UTI anticipates incremental pricing gains with activity levels slightly higher than the third quarter, with fourth-quarter revenue estimates of $61 million.
Based on contracts currently in place, Patterson-UTI expects its fourth-quarter 2022 rig count to average 81 rigs under term contracts. As the onshore driller foresees a ramp-up in drilling activity, it expects the third-quarter rig count to be 132 rigs, on average.
For 2022, PTEN anticipates its adjusted EBITDA to be more than $650 million, an update from the earlier guidance of $600 million. The company also increased its Capex forecast from $390 million to $425 million.
Zacks Rank & Key Picks
Patterson-UTI currently sports a Zacks Rank #1 (Strong Buy). Investors interested in the energy space might also look at some other top-ranked stocks — Par Pacific (PARR - Free Report) , NexTier Oilfield Solutions and Murphy USA (MUSA - Free Report) — each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Par Pacific’s 2022 earnings stands at $5.74 per share, which indicates an increase of about 433.7% from the year-ago loss of $1.72.
The consensus mark for PARR’s 2022 earnings has been revised upward three times over the past 60 days from $4.03 to $5.74 per share.
The Zacks Consensus Estimate for NexTier’s 2022 earnings stands at $1.40 per share, indicating an increase of about 425.6% from the year-ago loss of 43 cents.
NEX beat estimates for earnings in all the trailing four quarters, the average being around 271%.
The Zacks Consensus Estimate for Murphy USA’s 2022 EPS has been revised upward by about 11.35% over the past 60 days from $22.81 to $25.40.
MUSA beat the consensus mark for earnings in all the trailing four quarters, the average being approximately 51%.
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Patterson-UTI Energy (PTEN - Free Report) reported a third-quarter 2022 adjusted net profit of 28 cents per share, beating the Zacks Consensus Estimate of a profit of 19 cents. This outperformance can be attributed to third-quarter revenues beating the consensus mark due to solid segmental performances.
Moreover, the profit beat the year-ago quarter's loss of 44 cents per share on accelerated rig activity and much higher energy prices.
The company’s total quarterly revenues of $727.5 million outperformed the Zacks Consensus Estimate of $684 million. Moreover, the top line improved by an impressive 103.3% on a year-over-year basis.
In good news for investors, Patterson-UTI doubled its quarterly cash dividend to 8 cents per share from the previous 4-cent payout. The dividend will be paid out on Dec 15, 2022 to shareholders of record as of Dec 1, 2022. Moreover, PTEN also increased its share repurchase authorization to $300 million.
Segmental Performances
Contract Drilling: Revenues totaled $356 million, up by 125.5% from the last year’s third-quarter figure of $157.9 million due to continued day rate pricing momentum, contract renewals and increasing activity.
The unit posted an operating profit of $43.3 million in the third quarter, outperforming the year-ago loss of $51.8 million due to favorable pricing.
Pressure Pumping: Revenues of $287.7 million rose about 88.5% from the year-ago figure of $152.6 million due to better pricing.
Moreover, the segment posted an operating profit of $48.9 million compared to a loss of $13.7 million in the third quarter of 2021. The profit is attributable to active spreads being highly utilized in the reported quarter and better customer pricing.
Directional Drilling: Revenues summed at $58.9 million, up 85.5% year over year from the last year’s figure of $31.7 million due to higher activity and more favorable pricing. Moreover, the segment posted an operating profit of $4.4 million against a loss of $4.6 million reported in the corresponding quarter of 2021.
Other Operations: Revenues were $24.9 million, up about 59.8% more than the year-ago quarter’s $15.6 million as activity levels improved. The unit also posted a quarterly profit of $2.6 million compared to a loss of $1.3 million recorded in the year-ago quarter.
Capital Expenditure & Financial Position
In the third quarter of 2022, PTEN spent $126.35 million on capital programs (compared with $34.26 million in the third quarter of 2021). As of Sep 30, 2022, the company had $42.7 million of cash and cash equivalents and $852.9 million as long-term debt.
Outlook
For the fourth quarter, Patterson-UTI anticipates incremental pricing gains with activity levels slightly higher than the third quarter, with fourth-quarter revenue estimates of $61 million.
Based on contracts currently in place, Patterson-UTI expects its fourth-quarter 2022 rig count to average 81 rigs under term contracts. As the onshore driller foresees a ramp-up in drilling activity, it expects the third-quarter rig count to be 132 rigs, on average.
For 2022, PTEN anticipates its adjusted EBITDA to be more than $650 million, an update from the earlier guidance of $600 million. The company also increased its Capex forecast from $390 million to $425 million.
Zacks Rank & Key Picks
Patterson-UTI currently sports a Zacks Rank #1 (Strong Buy). Investors interested in the energy space might also look at some other top-ranked stocks — Par Pacific (PARR - Free Report) , NexTier Oilfield Solutions and Murphy USA (MUSA - Free Report) — each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Par Pacific’s 2022 earnings stands at $5.74 per share, which indicates an increase of about 433.7% from the year-ago loss of $1.72.
The consensus mark for PARR’s 2022 earnings has been revised upward three times over the past 60 days from $4.03 to $5.74 per share.
The Zacks Consensus Estimate for NexTier’s 2022 earnings stands at $1.40 per share, indicating an increase of about 425.6% from the year-ago loss of 43 cents.
NEX beat estimates for earnings in all the trailing four quarters, the average being around 271%.
The Zacks Consensus Estimate for Murphy USA’s 2022 EPS has been revised upward by about 11.35% over the past 60 days from $22.81 to $25.40.
MUSA beat the consensus mark for earnings in all the trailing four quarters, the average being approximately 51%.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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