Patterson-UTI Energy Reports Earnings with Uncertain Future
Patterson-UTI (PTEN) reported that its quarterly earnings per share were break-even, falling short of the Zacks Consensus Estimate of $0.01. This marks a significant decrease from last year’s earnings of $0.20 per share, with these figures adjusted for non-recurring items.
This quarterly report reveals an earnings surprise of -100%. In the previous quarter, analysts anticipated earnings of $0.09 per share, but the company actually reported $0.05 per share, leading to a surprise of -44.44%.
In the past four quarters, Patterson-UTI has managed to exceed consensus EPS estimates two times.
For the quarter ended September 2024, Patterson-UTI, which operates in the Zacks Oil and Gas – Drilling industry, reported revenues of $1.36 billion, surpassing the Zacks Consensus Estimate by 5.32%. This is a notable increase from the $1.01 billion reported one year ago. The company has exceeded consensus revenue estimates three times within the last four quarters.
Future stock performance following these results will be significantly influenced by management’s comments during the earnings call.
Since the start of the year, Patterson-UTI shares have declined approximately 27.2%, while the S&P 500 has gained 22.7%.
What Lies Ahead for Patterson-UTI?
Despite its underperformance compared to the market this year, investors are left wondering about the future of Patterson-UTI’s stock.
Although there are no straightforward answers, a key factor to consider is the company’s earnings outlook. This includes both current consensus earnings expectations for upcoming quarters and any recent changes to those expectations.
Research indicates a strong connection between short-term stock movements and trends in earnings estimate revisions. Investors can track these changes themselves or utilize tools like the Zacks Rank, known for its effectiveness in leveraging earnings estimate revisions.
Leading up to this earnings report, the estimate revisions for Patterson-UTI have been unfavorable. While changes could occur after the recent release, the current assessment places the stock at a Zacks Rank #4 (Sell), suggesting expected underperformance in the near term. For those interested, a comprehensive list of today’s Zacks #1 Rank (Strong Buy) stocks is available here.
Investors should closely monitor how estimates for upcoming quarters and the current fiscal year evolve in the weeks to come. Currently, the consensus EPS estimate stands at -$0.02 on expected revenues of $1.28 billion for the upcoming quarter and $0.18 on revenues of $5.37 billion for the current fiscal year.
It’s important to note that industry outlook can significantly affect stock performance. The Oil and Gas – Drilling sector is currently ranked in the bottom 19% among over 250 Zacks industries. Historically, sectors in the top 50% outperform those in the bottom 50% by a ratio exceeding 2 to 1.
Precision Drilling (PDS), a competitor in the same industry, is also yet to report its results for September 2024, with an expected release date of October 29. It is anticipated that Precision Drilling will report quarterly earnings of $1.55 per share, indicating a year-over-year increase of 43.5%. The EPS estimate has remained steady over the past month. Revenue projections for Precision Drilling stand at $367.26 million, reflecting a 10.3% rise from the previous year.
Is Investing in Patterson-UTI Energy, Inc. (PTEN) a Good Move?
If you’re considering an investment in Patterson-UTI Energy, Inc. (PTEN), you may want to explore Zacks Investment Research to discover the top stocks to buy over the next 30 days.
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
