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Dril-Quip (DRQ) Down 5.2% Since Q4 Earnings Miss: Here's Why
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Dril-Quip, Inc.’s (DRQ - Free Report) shares declined 5.2% since the announcement of weak fourth-quarter results on Feb 25. Market uncertainty owing to the coronavirus pandemic continues to hurt the company’s product bookings and bottom line.
Q4 Results
The company reported fourth-quarter 2020 adjusted loss per share of 12 cents, wider than the Zacks Consensus Estimate of a loss of a penny. In the year-ago period, the company reported a profit of 23 cents per share.
It registered total revenues of $87 million for the quarter, lower than $108 million in the year-ago period. Moreover, the figure missed the Zacks Consensus Estimate of $89 million.
Dril-Quip reported product bookings of $36 million for the quarter. The company added that the uncertain business scenario owing to the coronavirus pandemic has hurt its product bookings. Notably, the company recorded fourth-quarter operating loss of $11.6 million, wider than a loss of $2.1 million in the prior-year quarter.
Total Costs and Expenses
On the cost front, cost of sales declined to $64.1 million for the reported quarter from $67.2 million in the year-ago period. Engineering and product development costs, however, rose marginally to $4 million for the quarter from the year-ago figure of $3.9 million. Total cost and expenses for the quarter totaled $98.9 million compared with $93.4 million a year ago.
Free Cash Flow
Dril-Quip’s free cash outflow for the fourth quarter was $18.5 million. For fourth-quarter 2019, the company’s free cash flow was recorded at $5.2 million.
Backlog
At fourth quarter-end, it had $196 million in backlog, down from $273 million as of Dec 31, 2019.
Financials
Dril-Quip recorded $1.7 million capital expenditure for the quarter versus the year-ago level of $1.9 million.
As of Dec 31, 2020, its cash balance was $346 million. It had total available liquidity of $386.2 million. The company’s balance sheet is free of debt load, which highlights a sound financial position.
Guidance
For 2021, the leading manufacturer of highly engineered drilling and production equipment expects product bookings worth $40 million to $60 million per quarter. In the back half of this year, the company expects to see modest improvement since economies are reopening.
Zacks Rank & Key Picks
Dril-Quip currently carries a Zacks Rank #4 (Sell). Meanwhile, a few better-ranked players in the energy space include Matador Resources Company (MTDR - Free Report) , Antero Resources Corporation (AR - Free Report) and Diamondback Energy, Inc. (FANG - Free Report) . While Antero Resources carries a Zacks Rank #2 (Buy),Diamondback and Matador sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Matador is likely to see earnings growth of 201.3% in 2021.
Antero Resources has seen upward estimate revisions for 2021 earnings in the past 30 days.
Diamondback is likely to see earnings growth of 55% in 2021.
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Dril-Quip (DRQ) Down 5.2% Since Q4 Earnings Miss: Here's Why
Dril-Quip, Inc.’s (DRQ - Free Report) shares declined 5.2% since the announcement of weak fourth-quarter results on Feb 25. Market uncertainty owing to the coronavirus pandemic continues to hurt the company’s product bookings and bottom line.
Q4 Results
The company reported fourth-quarter 2020 adjusted loss per share of 12 cents, wider than the Zacks Consensus Estimate of a loss of a penny. In the year-ago period, the company reported a profit of 23 cents per share.
It registered total revenues of $87 million for the quarter, lower than $108 million in the year-ago period. Moreover, the figure missed the Zacks Consensus Estimate of $89 million.
DrilQuip, Inc. Price, Consensus and EPS Surprise
DrilQuip, Inc. price-consensus-eps-surprise-chart | DrilQuip, Inc. Quote
Fourth-Quarter Performance
Dril-Quip reported product bookings of $36 million for the quarter. The company added that the uncertain business scenario owing to the coronavirus pandemic has hurt its product bookings. Notably, the company recorded fourth-quarter operating loss of $11.6 million, wider than a loss of $2.1 million in the prior-year quarter.
Total Costs and Expenses
On the cost front, cost of sales declined to $64.1 million for the reported quarter from $67.2 million in the year-ago period. Engineering and product development costs, however, rose marginally to $4 million for the quarter from the year-ago figure of $3.9 million. Total cost and expenses for the quarter totaled $98.9 million compared with $93.4 million a year ago.
Free Cash Flow
Dril-Quip’s free cash outflow for the fourth quarter was $18.5 million. For fourth-quarter 2019, the company’s free cash flow was recorded at $5.2 million.
Backlog
At fourth quarter-end, it had $196 million in backlog, down from $273 million as of Dec 31, 2019.
Financials
Dril-Quip recorded $1.7 million capital expenditure for the quarter versus the year-ago level of $1.9 million.
As of Dec 31, 2020, its cash balance was $346 million. It had total available liquidity of $386.2 million. The company’s balance sheet is free of debt load, which highlights a sound financial position.
Guidance
For 2021, the leading manufacturer of highly engineered drilling and production equipment expects product bookings worth $40 million to $60 million per quarter. In the back half of this year, the company expects to see modest improvement since economies are reopening.
Zacks Rank & Key Picks
Dril-Quip currently carries a Zacks Rank #4 (Sell). Meanwhile, a few better-ranked players in the energy space include Matador Resources Company (MTDR - Free Report) , Antero Resources Corporation (AR - Free Report) and Diamondback Energy, Inc. (FANG - Free Report) . While Antero Resources carries a Zacks Rank #2 (Buy),Diamondback and Matador sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Matador is likely to see earnings growth of 201.3% in 2021.
Antero Resources has seen upward estimate revisions for 2021 earnings in the past 30 days.
Diamondback is likely to see earnings growth of 55% in 2021.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>