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Here's Why Hold Strategy is Apt for Cactus (WHD) Stock Now
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Cactus, Inc. (WHD - Free Report) has witnessed no earnings estimate revisions for 2023 and 2024 in the past seven days. The Zacks Consensus Estimate of earnings for 2023 and 2024 are pegged at $2.34 and $2.70 per share, respectively.
What's Favoring the Stock?
The price of West Texas Intermediate crude is currently trading at more than the $70-per-barrel mark. The positive trajectory in oil price is a boon for upstream operations like exploration and production activities.
Increased investments and activities from upstream firms will also lead to higher demand for engineered wellhead, pressure control and spoolable pipe technologies, which is a boon from Cactus. WHD’s highly engineered products are used for onshore unconventional oil and gas wells. In the United States, Cactus has a strong onshore wellhead market share. Over the years, the firm, carrying a Zacks Rank #3 (Hold), has reported a solid margin profile.
Headwinds
However, rising costs and expenses are hurting Cactus’ bottom line. Also, WHD has significant exposure to heightened volatility in oil and gas prices.
Enterprise Products has a stable business model and is not significantly exposed to the volatility in oil and gas prices. It generates stable fee-based revenues from its extensive pipeline network that spreads across more than 50,000 miles, transporting natural gas, natural gas liquids, crude oil petrochemicals and refined products.
Sunoco, a distributor of motor fuel to approximately 10,000 convenience stores, has a stable business model. For this year, SUN has witnessed upward earnings estimate revisions in the past 30 days.
Eni is a leading integrated energy player. By mid-century, Eni has a goal to achieve carbon neutrality, which is quite encouraging. In the past 30 days, the stock has witnessed upward earnings estimate revisions for this year.
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Here's Why Hold Strategy is Apt for Cactus (WHD) Stock Now
Cactus, Inc. (WHD - Free Report) has witnessed no earnings estimate revisions for 2023 and 2024 in the past seven days. The Zacks Consensus Estimate of earnings for 2023 and 2024 are pegged at $2.34 and $2.70 per share, respectively.
What's Favoring the Stock?
The price of West Texas Intermediate crude is currently trading at more than the $70-per-barrel mark. The positive trajectory in oil price is a boon for upstream operations like exploration and production activities.
Increased investments and activities from upstream firms will also lead to higher demand for engineered wellhead, pressure control and spoolable pipe technologies, which is a boon from Cactus. WHD’s highly engineered products are used for onshore unconventional oil and gas wells. In the United States, Cactus has a strong onshore wellhead market share. Over the years, the firm, carrying a Zacks Rank #3 (Hold), has reported a solid margin profile.
Headwinds
However, rising costs and expenses are hurting Cactus’ bottom line. Also, WHD has significant exposure to heightened volatility in oil and gas prices.
Stocks to Consider
Better-ranked players in the energy space include Enterprise Products Partners (EPD - Free Report) , Sunoco LP (SUN - Free Report) and Eni SpA (E - Free Report) . While Enterprise Products and Sunoco sport a Zacks Rank #1 (Strong Buy), Eni carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Enterprise Products has a stable business model and is not significantly exposed to the volatility in oil and gas prices. It generates stable fee-based revenues from its extensive pipeline network that spreads across more than 50,000 miles, transporting natural gas, natural gas liquids, crude oil petrochemicals and refined products.
Sunoco, a distributor of motor fuel to approximately 10,000 convenience stores, has a stable business model. For this year, SUN has witnessed upward earnings estimate revisions in the past 30 days.
Eni is a leading integrated energy player. By mid-century, Eni has a goal to achieve carbon neutrality, which is quite encouraging. In the past 30 days, the stock has witnessed upward earnings estimate revisions for this year.