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WFRD

Weatherford International NasdaqGS:WFRD Stock Report

Last Price

US$28.85

Market Cap

US$2.0b

7D

-10.5%

1Y

60.3%

Updated

25 Sep, 2022

Data

Company Financials +
WFRD fundamental analysis
Snowflake Score
Valuation5/6
Future Growth4/6
Past Performance0/6
Financial Health5/6
Dividends0/6

WFRD Stock Overview

Weatherford International plc, an energy services company, provides equipment and services for the drilling, evaluation, completion, production, and intervention of oil, geothermal, and natural gas wells worldwide.

Weatherford International plc Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Weatherford International
Historical stock prices
Current Share PriceUS$28.85
52 Week HighUS$40.16
52 Week LowUS$16.96
Beta2.61
1 Month Change4.53%
3 Month Change23.93%
1 Year Change60.28%
3 Year Changen/a
5 Year Changen/a
Change since IPO17.76%

Recent News & Updates

Sep 12

Weatherford International gets $400M contract from UAE's ADNOC

Weatherford International (NASDAQ:WFRD) said Monday it received a five-year contract from state-owned Abu Dhabi National Oil Company (ADNOC) for directional drilling and logging-while-drilling services. The contract is valued at over $400M and ADNOC has an option to extend the contract for an additional two years. WFRD said deploying its drilling services will add value to ADNOC's drilling operations by minimizing operating expenses, reducing risks and optimizing production.

Aug 09

Weatherford International: All Eyes On Deleveraging And Russia

WFRD's Q2 2022 top line and bottom line came in above expectations, and the company performed well for its key product and geographic segments. I like how Weatherford is managing a good balance between deleveraging and reinvesting for future growth, but I would have preferred that WFRD exits from Russia completely. I reduce my rating for WFRD from a Buy to a Hold, as the key re-rating catalyst relating to the Nasdaq relisting has already materialized. Elevator Pitch I downgrade my investment rating for Weatherford International's (WFRD) stock from a Buy to a Hold. I specifically highlighted the Nasdaq relisting re-rating catalyst for Weatherford in my earlier article written on May 17, 2021. With this catalyst having already been realized, I provide an update of my views on WFRD with this latest article. Weatherford's recent quarterly financial results were decent, but there is an absence of new catalysts for the name which justifies a Hold rating. Also, I will want to observe WFRD's future moves in relation to deleveraging and the Russian market, before turning bullish or bearish on the stock. This explains my Hold rating for WFRD. Key Financial Metrics For WFRD Weatherford delivered a very strong set of financial metrics for the most recent quarter. As indicated in its Q2 2022 financial results media release published in late-July, WFRD's top line increased by +13% QoQ and +18% YoY to $1,064 million. More importantly, Weatherford's performance in the recent quarter was good across the different geographies and various product lines. In the second quarter of 2022, the company's revenue derived from Latin America, North America and MENA (Middle East and North Africa) & Asian markets, grew by +29%, 22% and +21% YoY, respectively. Separately, revenue generated by Weatherford's Production & Intervention, Drilling & Evaluation, and Well Construction & Completions product segments increased by +24%, +20%, and +14%, respectively, in the most recent quarter. WFRD also turned around from GAAP net loss per share of -$1.11 for Q2 2021 and -$1.14 for Q1 2022 to achieve a positive GAAP EPS of $0.08 for Q2 2022. This was supported by a substantial expansion in Weatherford's operating profit margin. The non-GAAP adjusted EBITDA margin for WFRD was 17.5% for the second quarter of the current year, which was equivalent to a +1.4 percentage point QoQ improvement and a +2.4 percentage point YoY increase. Weatherford's financial performance for Q2 2022 was excellent in absolute terms, and also exceeded investors' expectations. WFRD's second-quarter top line was +6% higher than the sell-side's consensus estimate of $1.00 billion. Similarly, while Wall Street had expected the company to stay loss-making for the recent quarter, WFRD was able to generate positive earnings on a GAAP basis in Q2 2022. Moving ahead, the company management's decisions on deleveraging and Russia should be the key factors influencing Weatherford's share price outlook. Deleveraging Weatherford has done a great job in lowering its financial leverage and reducing its credit risks in the past couple of quarters. WFRD's net debt-to-EBITDA ratio has dropped from as high as 3.3 times as of end-Q1 2022 to just 2.0 times as of June 30, 2022, as highlighted in the company's Q2 2022 earnings presentation slides. In the second quarter of the current year, Weatherford redeemed $50 million worth of its 11% senior unsecured notes, with the remaining principal amount of these notes at around $250 million. Nevertheless, it is noteworthy that the decrease in Weatherford's financial leverage has been driven more by EBITDA growth rather than a decrease in net debt. Specifically, WFRD's trailing twelve months' EBITDA grew by +75% from $383 million in Q1 2021 to $670 million in Q2 2022. Over this same period, Weatherford's net debt actually increased from $1,270 million to $1,340 million. At its Q2 2022 investor briefing, WFRD revealed that its priority is to redeem or repay the remaining $250 million principal relating to its 11% senior unsecured notes. But Weatherford also highlighted at the recent quarterly results call that "purchasing other debt" is "not really the focus over the next few years", and it will focus on "reinvesting in the business and growing through the rest of the cycle" instead. In my view, Weatherford appeared to have struck a good balance between deleveraging and reinvestment as of now. However, I am not as comfortable with WFRD's decision relating to its involvement in the Russian market Russian Exposure Weatherford revealed at the company's second-quarter results call that the Russian market has historically accounted for approximately 5-7% of the company's sales. However, WFRD didn't disclose the proportion of its total EBITDA contributed by Russia.

Shareholder Returns

WFRDUS Energy ServicesUS Market
7D-10.5%-11.3%-5.2%
1Y60.3%8.7%-23.0%

Return vs Industry: WFRD exceeded the US Energy Services industry which returned 8.7% over the past year.

Return vs Market: WFRD exceeded the US Market which returned -23% over the past year.

Price Volatility

Is WFRD's price volatile compared to industry and market?
WFRD volatility
WFRD Average Weekly Movement9.6%
Energy Services Industry Average Movement8.9%
Market Average Movement6.9%
10% most volatile stocks in US Market15.8%
10% least volatile stocks in US Market2.8%

Stable Share Price: WFRD is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: WFRD's weekly volatility (10%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
197217,000Girish Saligramhttps://www.weatherford.com

Weatherford International plc, an energy services company, provides equipment and services for the drilling, evaluation, completion, production, and intervention of oil, geothermal, and natural gas wells worldwide. The company operates in two segments, Western Hemisphere and Eastern Hemisphere. It offers artificial lift systems, including reciprocating rod, progressing cavity pumping, gas, hydraulic, plunger, and hybrid lift systems, as well as related automation and control systems; pressure pumping and reservoir stimulation services, such as acidizing, fracturing, cementing, and coiled-tubing intervention; and drill stem test tools, surface well testing, and multiphase flow measurement services.

Weatherford International plc Fundamentals Summary

How do Weatherford International's earnings and revenue compare to its market cap?
WFRD fundamental statistics
Market CapUS$2.04b
Earnings (TTM)-US$330.00m
Revenue (TTM)US$3.91b

0.5x

P/S Ratio

-6.2x

P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
WFRD income statement (TTM)
RevenueUS$3.91b
Cost of RevenueUS$2.85b
Gross ProfitUS$1.07b
Other ExpensesUS$1.40b
Earnings-US$330.00m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)-4.68
Gross Margin27.28%
Net Profit Margin-8.43%
Debt/Equity Ratio483.5%

How did WFRD perform over the long term?

See historical performance and comparison