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ChampionX (CHX) Enhances Digital Solutions With ALP Acquisition

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ChampionX Corporation (CHX - Free Report) completes the acquisition of Artificial Lift Performance Limited (“ALP”), based in Edinburgh, Scotland. The move reflects CHX's strategic focus on digital growth. The company aims to deliver end-to-end digital solutions, enhancing productivity and profitability for customers' producing assets.

ALP specializes in advanced analytics solutions to enhance oil and gas production performance, particularly in developing artificial lift optimization software aimed at maximizing production and extending equipment life.

Benefits of the Buyout

The combination of ALP’s Pump Checker software with ChampionX’s XSPOC production optimization software offers advanced analytics for all major artificial lift types and chemical applications.

XSPOC, introduced to the market in 2000 by the Theta production optimization business unit, has a long history of creating additional value from rod-lifted wells. Pump Checker analytics enable operators to maximize production performance and improve equipment reliability in electrical submersible pumping (ESP) and gas lift systems.

Emphasis on Digital Solutions Bode Well

ChampionX focuses on accelerating digital and emissions growth through innovative development of 'fit for purpose' modular digital and emissions solutions. These solutions aid customers in enhancing efficiency and achieving emissions and sustainability targets. The company aims to drive growth by identifying opportunities to expand digitally-enabled products and digital revenue streams into adjacent markets.

In 2023, the company witnessed robust growth momentum in its digital business, marking a 16% year-over-year increase. This growth was broad-based, primarily driven by production optimization and emission technology offerings. CHX remains optimistic about the ongoing growth momentum of its digital portfolio. The company expects the recent final ruling of methane standards by EPA to drive accelerated growth in its emissions business.
 

Zacks Investment Research
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Shares of CHX have gained 6.9% compared with Zacks Engineering - R and D Services industry’s 16.5% increase in the past three months. It is expected to benefit from its production-oriented business portfolio, cost-saving strategies and digital innovations.

Going forward, ChampionX is well positioned for profitable growth by assisting its customers in maximizing the value of their producing assets through sustainable and cost-effective methods. The company leverages its technology, digital, and emissions capabilities along with first-class customer service. CHX expects future digital revenues to continue benefiting from this industry trend.

Zacks Rank & Key Picks

ChampionX currently carries a Zacks Rank #4 (Sell).

Here are some better-ranked stocks from the Construction sector.

Acuity Brands, Inc. (AYI - Free Report) currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. It has a trailing four-quarter earnings surprise of 13.9%, on average. Shares of AYI have increased 29.5% in the past year.

The Zacks Consensus Estimate for AYI’s fiscal 2024 sales indicates a decline of 2.4%, while earnings per share (EPS) indicates an improvement of 5.3% from the year-ago levels.

TopBuild Corp. (BLD - Free Report) carries a Zacks Rank of #2 (Buy). It has a trailing four-quarter earnings surprise of 14.3%, on average. Shares of BLD have increased 100.6% in the past year.

The Zacks Consensus Estimate for BLD’s 2024 sales and EPS indicates an increase of 7.2% and 5.6%, respectively, from the year-ago period’s levels.

Eagle Materials Inc. (EXP - Free Report) sports a Zacks Rank #2. It has a trailing four-quarter earnings surprise of 6.5%, on average. Shares of EXP have increased 75.2% in the past year.

The Zacks Consensus Estimate for EXP’s 2024 sales and EPS suggests growth of 6.8% and 13.8%, respectively, from the year-ago period’s levels.

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