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Nov Inc. (NOV) Down 13.2% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Nov Inc. (NOV - Free Report) . Shares have lost about 13.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Nov Inc. due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
NOV Q4 Earnings & Revenue Beat Estimates
NOV Inc. reported fourth-quarter 2024 adjusted earnings of 41 cents per share, which beat the Zacks Consensus Estimate of 35 cents. This outperformance can be attributed to better-than-expected cost control and higher-margin projects in its Energy Equipment segment. However, the bottom line decreased from the year-ago quarter’s 54 cents.
The oil and gas equipment and services company’s total revenues of $2.3 billion beat the Zacks Consensus Estimate by 3.2%, driven by stronger-than-expected revenues from Energy Equipment segment and Energy Products and Services segment, which surpassed Zacks Consensus marks by 5.1% and 1.9%, respectively. However, revenues declined 1.5% from the year-ago quarter’s figure.
In the fourth quarter, NOV repurchased 7.5 million shares of common stock for $112 million. For the year, the company repurchased a total of 14.2 million shares, amounting to $229 million. Including dividends, NOV returned $337 million in capital to its shareholders in 2024. The company recorded $7 million in Other Items, mainly due to severance and facility closure costs during the same time.
Segmental Performances
Energy Products and Services: The unit reported fourth-quarter revenues of $1.1 billion, which beat our prediction of $1 billion. However, the figure decreased from the prior-year quarter’s reported number by 1.2%, due to reduced global drilling activity.
Adjusted EBITDA of $173 million was below our estimate of $181.5 million. The reported actuals also decreased from $197 million in the corresponding period of 2023.
Energy Equipment: Revenues in this segment decreased 1.4% year over year to $1.3 billion, missing our estimation by 5.3%. The drop in revenues was mostly because the company sold its Pole Products business in early 2024 and saw lower revenues from aftermarket support.
Adjusted EBITDA of $159 million increased from the year-earlier quarter’s $124 million. The segment's revenues and profitability increased because of the successful execution of higher-margin projects from its backlog. However, the figure was lower than our estimate of $161.9 million.
This segment experienced strong demand with new orders of $757 million in the quarter, indicating an increase of $129 million from a year ago, resulting in a book-to-bill ratio of 121%.
As of Dec. 31, the backlog for Energy Equipment capital orders was $4.4 billion, indicating an increase of $279 million from the prior year.
Balance Sheet
As of Dec. 31, 2024, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.7 billion with a debt-to-capitalization of 20.9%. The company had $1.5 billion available on its primary revolving credit facility during the same time.
This company generated $591 million in operating cash flow and $473 million in free cash flow in this quarter.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -11.71% due to these changes.
VGM Scores
Currently, Nov Inc. has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Nov Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Nov Inc. (NOV) Down 13.2% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Nov Inc. (NOV - Free Report) . Shares have lost about 13.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Nov Inc. due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
NOV Q4 Earnings & Revenue Beat Estimates
NOV Inc. reported fourth-quarter 2024 adjusted earnings of 41 cents per share, which beat the Zacks Consensus Estimate of 35 cents. This outperformance can be attributed to better-than-expected cost control and higher-margin projects in its Energy Equipment segment. However, the bottom line decreased from the year-ago quarter’s 54 cents.
The oil and gas equipment and services company’s total revenues of $2.3 billion beat the Zacks Consensus Estimate by 3.2%, driven by stronger-than-expected revenues from Energy Equipment segment and Energy Products and Services segment, which surpassed Zacks Consensus marks by 5.1% and 1.9%, respectively. However, revenues declined 1.5% from the year-ago quarter’s figure.
In the fourth quarter, NOV repurchased 7.5 million shares of common stock for $112 million. For the year, the company repurchased a total of 14.2 million shares, amounting to $229 million. Including dividends, NOV returned $337 million in capital to its shareholders in 2024. The company recorded $7 million in Other Items, mainly due to severance and facility closure costs during the same time.
Segmental Performances
Energy Products and Services: The unit reported fourth-quarter revenues of $1.1 billion, which beat our prediction of $1 billion. However, the figure decreased from the prior-year quarter’s reported number by 1.2%, due to reduced global drilling activity.
Adjusted EBITDA of $173 million was below our estimate of $181.5 million. The reported actuals also decreased from $197 million in the corresponding period of 2023.
Energy Equipment: Revenues in this segment decreased 1.4% year over year to $1.3 billion, missing our estimation by 5.3%. The drop in revenues was mostly because the company sold its Pole Products business in early 2024 and saw lower revenues from aftermarket support.
Adjusted EBITDA of $159 million increased from the year-earlier quarter’s $124 million. The segment's revenues and profitability increased because of the successful execution of higher-margin projects from its backlog. However, the figure was lower than our estimate of $161.9 million.
This segment experienced strong demand with new orders of $757 million in the quarter, indicating an increase of $129 million from a year ago, resulting in a book-to-bill ratio of 121%.
As of Dec. 31, the backlog for Energy Equipment capital orders was $4.4 billion, indicating an increase of $279 million from the prior year.
Balance Sheet
As of Dec. 31, 2024, the company had cash and cash equivalents of $1.2 billion and long-term debt of $1.7 billion with a debt-to-capitalization of 20.9%. The company had $1.5 billion available on its primary revolving credit facility during the same time.
This company generated $591 million in operating cash flow and $473 million in free cash flow in this quarter.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -11.71% due to these changes.
VGM Scores
Currently, Nov Inc. has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Nov Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.