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Why Is Helmerich & Payne (HP) Up 7.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for Helmerich & Payne (HP - Free Report) . Shares have added about 7.3% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Helmerich & Payne due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Helmerich & Payne, Inc. before we dive into how investors and analysts have reacted as of late.
Helmerich & Payne Q2 Earnings & Revenues Miss Estimates
Helmerich & Payne reported a second-quarter fiscal 2026 adjusted net loss of 38 cents per share, wider than the Zacks Consensus Estimate of an adjusted net loss of 6 cents. Moreover, the bottom line decreased considerably from the year-ago quarter’s reported profit of 2 cents. This was due to a weaker rig activity in North America and international markets, and significantly higher operating costs related to its Middle East operations.
The International Solutions segment posted an operating loss of nearly $100 million as the company incurred additional expenses to reactivate rigs in Saudi Arabia and work around supply-chain disruptions caused by the Middle East conflict. Moreover, the quarter included a $26 million non-cash impairment charge, which further pressured profitability.
Revenues totaled $932 million, missing the consensus mark of $946 million by 1.46%. The top line also declined 8.2% year over year from the prior-year quarter’s level of $1 billion, primarily due to lower revenue contributions from drilling services.
The company returned approximately $25 million to shareholders through its ongoing dividend program during the quarter. Management also noted continued progress in expanding the deployment of FlexRobotics technology to support customer demand.
Q2 Segmental Performance
North America Solutions: Operating revenues of $517.2 million decreased 13.7% year over year. Moreover, the top line missed our projection of $519.1 million.
The segment averaged 136 active rigs in the quarter and delivered a direct margin of $215.2 million, or $17,628 on a per-day basis, maintaining industry-leading performance.
Segment operating income was $111.3 million, improving sequentially from the prior quarter that included a one-time impairment, but down from $151.9 million in the year-ago period. However, the reported figure beat our estimate of $93.9 million.
HP highlighted strengthening customer sentiment and meaningful commercial momentum across the U.S. land market, supported by new contracts and extensions across multiple basins.
International Solutions: Operating revenues were $218.3 million, down 11.9% from $247.9 million a year ago. Moreover, the top line missed our projection of $231 million.
The segment recorded an operating loss of approximately $100 million and generated about $11.5 million of direct margin, down from the prior quarter’s level. The operating loss was wider than our projected loss of $85.1 million.
HP attributed the weaker profitability primarily to the impacts of the conflict in the Middle East. During the quarter, the company utilized in-house engineering and aftermarket capabilities to reactivate rigs in Saudi Arabia using in-country equipment and working around supply-chain constraints. While this enhanced returns and avoided customer delays, it also resulted in more costs being classified as operating expenses, pressuring direct margins.
Offshore Solutions: Revenues rose 15% year over year to $171.4 million. However, the top line beat our projection of $152.9 million.
The segment reported operating income of about $14 million and delivered a direct margin of roughly $27 million, down from the prior quarter’s level by 19.3%. Moreover, the figure beat our estimate of $11.4 million.
HP emphasized the strategic value of the offshore portfolio given its long-term contract structure and relative earnings stability. During the quarter, the company secured a five-year renewal with bp in the Caspian Sea, offshore Azerbaijan, with three one-year extension options. If all option periods are exercised, contract revenues could exceed $1 billion.
Financial Position
As of March 31, 2026, HP had $177.2 million in cash and cash equivalents. Long-term debt totaled $1.9 billion (debt-to-capitalization of 41.4%).
Following the quarter, HP completed the sale of Utica Square in early April, with after-tax proceeds exceeding its previously communicated $100 million divestiture target. The transaction enabled the retirement of the term loan facility ahead of schedule, reducing post-acquisition debt by $400 million and accelerating deleveraging plans.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 45.12% due to these changes.
VGM Scores
At this time, Helmerich & Payne has a subpar Growth Score of D, a score with the same score on the momentum front. However, the stock was allocated a score of B on the value side, putting it in the top 40% for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Helmerich & Payne has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Helmerich & Payne belongs to the Zacks Oil and Gas - Drilling industry. Another stock from the same industry, Patterson-UTI (PTEN - Free Report) , has gained 7.5% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
Patterson-UTI reported revenues of $1.12 billion in the last reported quarter, representing a year-over-year change of -12.7%. EPS of -$0.06 for the same period compares with $0.00 a year ago.
For the current quarter, Patterson-UTI is expected to post a loss of $0.05 per share, indicating a change of +16.7% from the year-ago quarter. The Zacks Consensus Estimate has changed +20% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Patterson-UTI. Also, the stock has a VGM Score of B.
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Why Is Helmerich & Payne (HP) Up 7.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Helmerich & Payne (HP - Free Report) . Shares have added about 7.3% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Helmerich & Payne due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Helmerich & Payne, Inc. before we dive into how investors and analysts have reacted as of late.
Helmerich & Payne Q2 Earnings & Revenues Miss Estimates
Helmerich & Payne reported a second-quarter fiscal 2026 adjusted net loss of 38 cents per share, wider than the Zacks Consensus Estimate of an adjusted net loss of 6 cents. Moreover, the bottom line decreased considerably from the year-ago quarter’s reported profit of 2 cents. This was due to a weaker rig activity in North America and international markets, and significantly higher operating costs related to its Middle East operations.
The International Solutions segment posted an operating loss of nearly $100 million as the company incurred additional expenses to reactivate rigs in Saudi Arabia and work around supply-chain disruptions caused by the Middle East conflict. Moreover, the quarter included a $26 million non-cash impairment charge, which further pressured profitability.
Revenues totaled $932 million, missing the consensus mark of $946 million by 1.46%. The top line also declined 8.2% year over year from the prior-year quarter’s level of $1 billion, primarily due to lower revenue contributions from drilling services.
The company returned approximately $25 million to shareholders through its ongoing dividend program during the quarter. Management also noted continued progress in expanding the deployment of FlexRobotics technology to support customer demand.
Q2 Segmental Performance
North America Solutions: Operating revenues of $517.2 million decreased 13.7% year over year. Moreover, the top line missed our projection of $519.1 million.
The segment averaged 136 active rigs in the quarter and delivered a direct margin of $215.2 million, or $17,628 on a per-day basis, maintaining industry-leading performance.
Segment operating income was $111.3 million, improving sequentially from the prior quarter that included a one-time impairment, but down from $151.9 million in the year-ago period. However, the reported figure beat our estimate of $93.9 million.
HP highlighted strengthening customer sentiment and meaningful commercial momentum across the U.S. land market, supported by new contracts and extensions across multiple basins.
International Solutions: Operating revenues were $218.3 million, down 11.9% from $247.9 million a year ago. Moreover, the top line missed our projection of $231 million.
The segment recorded an operating loss of approximately $100 million and generated about $11.5 million of direct margin, down from the prior quarter’s level. The operating loss was wider than our projected loss of $85.1 million.
HP attributed the weaker profitability primarily to the impacts of the conflict in the Middle East. During the quarter, the company utilized in-house engineering and aftermarket capabilities to reactivate rigs in Saudi Arabia using in-country equipment and working around supply-chain constraints. While this enhanced returns and avoided customer delays, it also resulted in more costs being classified as operating expenses, pressuring direct margins.
Offshore Solutions: Revenues rose 15% year over year to $171.4 million. However, the top line beat our projection of $152.9 million.
The segment reported operating income of about $14 million and delivered a direct margin of roughly $27 million, down from the prior quarter’s level by 19.3%. Moreover, the figure beat our estimate of $11.4 million.
HP emphasized the strategic value of the offshore portfolio given its long-term contract structure and relative earnings stability. During the quarter, the company secured a five-year renewal with bp in the Caspian Sea, offshore Azerbaijan, with three one-year extension options. If all option periods are exercised, contract revenues could exceed $1 billion.
Financial Position
As of March 31, 2026, HP had $177.2 million in cash and cash equivalents. Long-term debt totaled $1.9 billion (debt-to-capitalization of 41.4%).
Following the quarter, HP completed the sale of Utica Square in early April, with after-tax proceeds exceeding its previously communicated $100 million divestiture target. The transaction enabled the retirement of the term loan facility ahead of schedule, reducing post-acquisition debt by $400 million and accelerating deleveraging plans.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 45.12% due to these changes.
VGM Scores
At this time, Helmerich & Payne has a subpar Growth Score of D, a score with the same score on the momentum front. However, the stock was allocated a score of B on the value side, putting it in the top 40% for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Helmerich & Payne has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Helmerich & Payne belongs to the Zacks Oil and Gas - Drilling industry. Another stock from the same industry, Patterson-UTI (PTEN - Free Report) , has gained 7.5% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
Patterson-UTI reported revenues of $1.12 billion in the last reported quarter, representing a year-over-year change of -12.7%. EPS of -$0.06 for the same period compares with $0.00 a year ago.
For the current quarter, Patterson-UTI is expected to post a loss of $0.05 per share, indicating a change of +16.7% from the year-ago quarter. The Zacks Consensus Estimate has changed +20% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Patterson-UTI. Also, the stock has a VGM Score of B.