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National Oilwell (NOV) Posts Narrower-Than-Expected Q2 Loss
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National Oilwell Varco, Inc. (NOV - Free Report) reported adjusted loss of 7 cents per share for second-quarter 2020, narrower than the Zacks Consensus Estimate of a loss of 11 cents. Particularly, better-than-expected revenues from the Completion & Production Solutions segment led to this outperformance. However, the bottom line came wider than the year-ago loss of 4 cents due to weakness in the Rig Technologies and the Wellbore Technologies unit.
Total revenues of $1.50 billion underperformed the Zacks Consensus Estimate of $1.54 billion and also dipped 29.8% from the year-ago number of $2.13 billion.
The oil & gas industry is suffering heavy economic damages triggered by the COVID-19 pandemic that drastically affected drilling activity. Against this backdrop, National Oilwell is aggressively curbing expenses and driving cash flow through more prudent strategies and a disciplined working capital deployment.
Segmental Performance
Rig Technologies: Revenues summed $476 million, which missed the Zacks Consensus Estimate of $498 million and also compared unfavorably with the year-ago quarter’s $671 million, thanks to a drop in the global rig activity and a decline in aftermarket revenues, resulting from coronavirus-induced logistics troubles. The unit’s adjusted EBITDA of $14 million decreased from the year-earlier quarter’s $74 million.
Wellbore Technologies: Segmental revenues of $442 million lagged the Zacks Consensus Estimate of $494 million and also fell 48% year over year as a result of reduced drilling operations in North America and Latin America. Meanwhile, the unit’s adjusted EBITDA of $42 million deteriorated from the prior-year’s $134 million.
Completion & Production Solutions: Revenues of $611 million outperformed the Zacks Consensus Estimate of $600 million but dropped 7.84% from $663 million in the year-earlier quarter. This could be attributable to dwindling situations in the global completions market and logistical troubles from COVID-19-related restrictions, which were partially offset by a strong execution of existing backlog. The unit recorded adjusted EBITDA of $68 million, up 30.8% from the year-ago figure of $52 million.
National Oilwell Varco, Inc. Price, Consensus and EPS Surprise
Capital equipment order backlog for Rig Technologies was $2.79 billion as of Jun 30, 2020 including $74 million worth of new orders.
Meanwhile, the Completion & Production Solutions’ backlog for capital equipment orders totalled $1 billion at the end of the second quarter. The figure included $196 million worth of new orders.
Balance Sheet
As of Jun 30, 2020, the company had cash and cash equivalents of $1.45 billion and long-term debt of $2.03 billion. The total debt-to-total capitalization was 26.8%.
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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National Oilwell (NOV) Posts Narrower-Than-Expected Q2 Loss
National Oilwell Varco, Inc. (NOV - Free Report) reported adjusted loss of 7 cents per share for second-quarter 2020, narrower than the Zacks Consensus Estimate of a loss of 11 cents. Particularly, better-than-expected revenues from the Completion & Production Solutions segment led to this outperformance. However, the bottom line came wider than the year-ago loss of 4 cents due to weakness in the Rig Technologies and the Wellbore Technologies unit.
Total revenues of $1.50 billion underperformed the Zacks Consensus Estimate of $1.54 billion and also dipped 29.8% from the year-ago number of $2.13 billion.
The oil & gas industry is suffering heavy economic damages triggered by the COVID-19 pandemic that drastically affected drilling activity. Against this backdrop, National Oilwell is aggressively curbing expenses and driving cash flow through more prudent strategies and a disciplined working capital deployment.
Segmental Performance
Rig Technologies: Revenues summed $476 million, which missed the Zacks Consensus Estimate of $498 million and also compared unfavorably with the year-ago quarter’s $671 million, thanks to a drop in the global rig activity and a decline in aftermarket revenues, resulting from coronavirus-induced logistics troubles. The unit’s adjusted EBITDA of $14 million decreased from the year-earlier quarter’s $74 million.
Wellbore Technologies: Segmental revenues of $442 million lagged the Zacks Consensus Estimate of $494 million and also fell 48% year over year as a result of reduced drilling operations in North America and Latin America. Meanwhile, the unit’s adjusted EBITDA of $42 million deteriorated from the prior-year’s $134 million.
Completion & Production Solutions: Revenues of $611 million outperformed the Zacks Consensus Estimate of $600 million but dropped 7.84% from $663 million in the year-earlier quarter. This could be attributable to dwindling situations in the global completions market and logistical troubles from COVID-19-related restrictions, which were partially offset by a strong execution of existing backlog. The unit recorded adjusted EBITDA of $68 million, up 30.8% from the year-ago figure of $52 million.
National Oilwell Varco, Inc. Price, Consensus and EPS Surprise
National Oilwell Varco, Inc. price-consensus-eps-surprise-chart | National Oilwell Varco, Inc. Quote
Backlog
Capital equipment order backlog for Rig Technologies was $2.79 billion as of Jun 30, 2020 including $74 million worth of new orders.
Meanwhile, the Completion & Production Solutions’ backlog for capital equipment orders totalled $1 billion at the end of the second quarter. The figure included $196 million worth of new orders.
Balance Sheet
As of Jun 30, 2020, the company had cash and cash equivalents of $1.45 billion and long-term debt of $2.03 billion. The total debt-to-total capitalization was 26.8%.
Zacks Rank & Key Picks
National Oilwell carries a Zacks Rank #3 (Hold), currently. Some better-ranked players in the energyspace are Royal Dutch Shell PLC , TC PipeLines LP and NextDecade Corporation (NEXT - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>