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FET

Forum Energy Technologies NYSE:FET Stock Report

Last Price

US$26.24

Market Cap

US$150.1m

7D

12.6%

1Y

35.4%

Updated

12 Aug, 2022

Data

Company Financials
FET fundamental analysis
Snowflake Score
Valuation2/6
Future Growth0/6
Past Performance0/6
Financial Health2/6
Dividends0/6

FET Stock Overview

Forum Energy Technologies, Inc. designs, manufactures, and distributes products serving the oil, natural gas, industrial, and renewable energy industries in the United States and internationally.

Forum Energy Technologies Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Forum Energy Technologies
Historical stock prices
Current Share PriceUS$26.24
52 Week HighUS$26.51
52 Week LowUS$14.71
Beta3.22
1 Month Change45.29%
3 Month Change34.15%
1 Year Change35.40%
3 Year Change-13.11%
5 Year Change-87.51%
Change since IPO-93.97%

Recent News & Updates

Aug 05

Forum Energy reports Q2 earnings; raises FY22 guidance and issues Q3 outlook

Forum Energy press release (NYSE:FET): Q2 Non-GAAP EPS of -$0.73. Revenue of $172.2M (+25.7% Y/Y). Orders of $203M and book-to-bill ratio of 1.18 Adjusted EBITDA of $15.5M, a sequential increase of 74%. "We forecast third quarter revenue to be between $170 and $180 million, and adjusted EBITDA of $16 to $19 million. On a full year basis, our financial outlook has improved, and we now expect adjusted EBITDA to be near the top end of our previous guidance range of $50 to $60 million."

Jul 08

Forum Energy Technologies: Completions Segment Demand And International Contracts Hold It Steady

Drilling and Completions segments topline has tailwinds following increased energy activity in the US and internationally. It focuses on creating an asset-light and scalable base, mitigating the inflationary pressures. Diversification into offshore wind can become more profitable as demand exceeds supply. Negative cash flows and high leverage cast doubts, but debt-to-equity conversion can lower the risk level. FET Is On A Steady Path Forum Energy Technologies (FET) will likely benefit from increased demand for completions equipment, including flexible hoses and a single-line manifold system. It aims to realize net price benefit, mitigating the inflationary pressures. Over the medium-to-long term, it plans to weigh in on low carbon energies like offshore wind. New rigs in Latin America and the Middle East have also led to higher international awards for the company. The stock is reasonably valued versus its peers. However, supply chain constraints can lower the operating margin expansion. Plus, earnings growth can significantly outperform the operating income growth and help de-lever the balance sheet. Investors might want to hold on to the stock with expectations of steady returns in the medium term. Completions Business And Long-Term Drivers Seeking Alpha You may read about Forum Energy Technologies strategy in my previous article here. Before we dig deep into that, let us look at the current drilling industry environment. The US onshore rig count has increased 12% since Q1. According to the EIA, the drilled well count increased by 28% year-to-date. On the other hand, the DUC wells have gone down by 11% during this period. FET's management estimates that the current growth of drilled and completed wells will require upgrades of critical components like iron roughnecks. As a result, the company's FR120 solution, which handles large diameter drill pipes, will see increased demand. Its Serpent Series flexible hose and the single-line manifold system can be more efficient in the current completions work scenario in hydraulic fracturing. In low carbon energies like offshore wind, the company can leverage its engineering, designing, and manufacturing capabilities in the subsea remotely operated vehicles (ROVs) and trencher. The demand for offshore wind can exceed supply and become more profitable in the future. Explaining The Long-Term Strategy FET's current strategy involved creating an asset-light, scalable base with operating leverage, mitigating the inflationary pressures, and realizing net price benefit by focusing on products where demand outstrips supply. It aims to dramatically increase revenue and be in a position where it can generate 25% to 40% of incremental EBITDA margin. Q2 2022 Guidance The steadily increasing rig count will likely impact the demand for FET's products and services. So, the management expects its Q2 revenues to increase by 6% (at the guidance midpoint) compared to Q1. Adjusted EBITDA can inflate by 39% in Q2. In FY2022, the management expects the overall cost structure to lower significantly and improve profitability. So, the management kept its annual EBITDA estimates unchanged at $50 million to $60 million, or 175% higher than in FY2021. The net income growth, however, can exceed the operating margin expansion. Since the company looks to convert half of its debt to equity, earnings growth can significantly de-lever the company. Segment Value Drivers In Q1 Company Filings Drilling & Downhole segment: The Drilling & Downhole segment revenues increased by 7% in Q1 2022 compared to Q4 2021. Increased demand for onshore and offshore drilling, well construction equipment, and accelerated international spending led to the topline improvement. Quarter-over-quarter, the segment order decreased by ~17% as it received an award for tool packages in Latin America and the Middle East. In early Q2, it received another five-year contract in the Middle East, propelling the top line in the near term. Completions segment: The Completions segment revenue growth was modest (3% up quarter-over-quarter) in Q1. The supply chain delays affected the company's customers adversely, while a low inventory of drilled but uncompleted (or DUC) wells also reduced demand. On the other hand, an increased need for cables from quality wireline can mitigate the pressure partially. The segment order growth was also moderate in Q1 (~2% up), which may hold product delivery steady over the next few months. FET's Q1 2022 Press release Production segment: This segment witnessed the lowest revenue growth (by 1.9%) in Q1 compared to the previous quarter. Despite that, a favorable product mix and higher demand for the valve product line expanded the margin. The order book declined (12.4% down) during this period. Cash Flows And Debt Forum's cash flow from operations (or CFO) went deeper into the red (-$25 million) in Q1 2022 versus a year ago. In Q1, it increased inventory to meet customer demand, leading to higher working capital requirements. Although year-over-year revenues increased, the adverse changes in working capital contributed to the fall. Given the uncertainty in global logistics supply, its inventory balance may rise again in Q2. So, the free cash flow can deteriorate more. FET's liquidity stood at $162 million as of March 31, 2022. Its debt-to-equity was 0.75x as of that date. A significant part of its total debt (nearly 50%) is convertible to equity. A conversion can significantly de-lever the balance sheet and increase enterprise value. Linear Regression Based Forecast Author created, Seeking Alpha, and EIA Based on a regression equation between crude oil price, US completion wells, and drilled wells, and FET's revenues for the past seven years and the previous four quarters, I expect its revenues to remain steady in the next two years but may decrease in the year after that. Author created and Seeking Alpha

Shareholder Returns

FETUS Energy ServicesUS Market
7D12.6%7.4%3.2%
1Y35.4%31.7%-10.1%

Return vs Industry: FET exceeded the US Energy Services industry which returned 28.5% over the past year.

Return vs Market: FET exceeded the US Market which returned -11.7% over the past year.

Price Volatility

Is FET's price volatile compared to industry and market?
FET volatility
FET Average Weekly Movement8.9%
Energy Services Industry Average Movement9.7%
Market Average Movement7.7%
10% most volatile stocks in US Market16.9%
10% least volatile stocks in US Market3.2%

Stable Share Price: FET is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 9% a week.

Volatility Over Time: FET's weekly volatility (9%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
20051,400Neal Luxhttps://www.f-e-t.com

Forum Energy Technologies, Inc. designs, manufactures, and distributes products serving the oil, natural gas, industrial, and renewable energy industries in the United States and internationally. It operates through three segments: Drilling & Downhole, Completions, and Production. The Drilling & Downhole segment designs, manufactures, and supplies products, and provides related services to the drilling, well construction, artificial lift, and subsea energy construction markets, including applications in oil and natural gas, renewable energy, defense, and communications.

Forum Energy Technologies Fundamentals Summary

How do Forum Energy Technologies's earnings and revenue compare to its market cap?
FET fundamental statistics
Market CapUS$150.12m
Earnings (TTM)-US$31.12m
Revenue (TTM)US$616.55m

0.2x

P/S Ratio

-4.8x

P/E Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
FET income statement (TTM)
RevenueUS$616.55m
Cost of RevenueUS$464.41m
Gross ProfitUS$152.14m
Other ExpensesUS$183.26m
Earnings-US$31.12m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)-5.44
Gross Margin24.68%
Net Profit Margin-5.05%
Debt/Equity Ratio87.2%

How did FET perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.

Valuation

Is FET undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for FET?

Other financial metrics that can be useful for relative valuation.

FET key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue0.7x
Enterprise Value/EBITDA22.8x
PEG Ration/a

Price to Sales Ratio vs Peers

How does FET's PS Ratio compare to its peers?

FET PS Ratio vs Peers
The above table shows the PS ratio for FET vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPSEstimated GrowthMarket Cap
Peer Average0.4x
EXTN Exterran
0.2x4.2%US$156.6m
SND Smart Sand
0.5x22.0%US$90.3m
CCLP CSI Compressco
0.5xn/aUS$176.5m
NCSM NCS Multistage Holdings
0.5xn/aUS$69.1m
FET Forum Energy Technologies
0.2xn/aUS$150.1m

Price-To-Sales vs Peers: FET is good value based on its Price-To-Sales Ratio (0.2x) compared to the peer average (0.4x).


Price to Earnings Ratio vs Industry

How does FET's PE Ratio compare vs other companies in the US Energy Services Industry?

Price-To-Sales vs Industry: FET is good value based on its Price-To-Sales Ratio (0.2x) compared to the US Energy Services industry average (1x)


Price to Sales Ratio vs Fair Ratio

What is FET's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

FET PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio0.2x
Fair PS Ration/a

Price-To-Sales vs Fair Ratio: Insufficient data to calculate FET's Price-To-Sales Fair Ratio for valuation analysis.


Share Price vs Fair Value

What is the Fair Price of FET when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: Insufficient data to calculate FET's fair value for valuation analysis.

Significantly Below Fair Value: Insufficient data to calculate FET's fair value for valuation analysis.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Insufficient data to show price forecast.


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Future Growth

How is Forum Energy Technologies forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


54.4%

Forecasted Energy industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Forum Energy Technologies has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


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  • Take a look at our analysis of FET’s management and see if the CEO’s compensation is within a reasonable range, who is on the board and if insiders have been trading lately.
  • Forum Energy Technologies competitive advantages and company strategy can generally be found in its financial reports archived here.

Past Performance

How has Forum Energy Technologies performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


2.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: FET is currently unprofitable.

Growing Profit Margin: FET is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: FET is unprofitable, but has reduced losses over the past 5 years at a rate of 2.5% per year.

Accelerating Growth: Unable to compare FET's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: FET is unprofitable, making it difficult to compare its past year earnings growth to the Energy Services industry (112.2%).


Return on Equity

High ROE: FET has a negative Return on Equity (-10.09%), as it is currently unprofitable.


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Financial Health

How is Forum Energy Technologies's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Stable Cash Runway

  • Forecast Cash Runway

Financial Position Analysis

Short Term Liabilities: FET's short term assets ($485.2M) exceed its short term liabilities ($184.3M).

Long Term Liabilities: FET's short term assets ($485.2M) exceed its long term liabilities ($314.7M).


Debt to Equity History and Analysis

Debt Level: FET's net debt to equity ratio (78.4%) is considered high.

Reducing Debt: FET's debt to equity ratio has increased from 34% to 87.2% over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: FET has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: FET has less than a year of cash runway if free cash flow continues to reduce at historical rates of 12.9% each year


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Dividend

What is Forum Energy Technologies's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate FET's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate FET's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if FET's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FET's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as FET has not reported any payouts.


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Management

How experienced are the management team and are they aligned to shareholders interests?

3.0yrs

Average management tenure


CEO

Neal Lux (46 yo)

0.50

Tenure

US$1,467,126

Compensation

Mr. Neal Lux serves as Chief Executive Officer, President and Director at Forum Energy Technologies, Inc since February 18, 2022. Mr. Lux had been Executive Vice President and Chief Operating Officer of Fo...


CEO Compensation Analysis

Compensation vs Market: Neal's total compensation ($USD1.47M) is about average for companies of similar size in the US market ($USD1.66M).

Compensation vs Earnings: Insufficient data to compare Neal's compensation with company performance.


Leadership Team

Experienced Management: FET's management team is considered experienced (3 years average tenure).


Board Members

Experienced Board: FET's board of directors are seasoned and experienced ( 11.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Forum Energy Technologies, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Forum Energy Technologies, Inc.
  • Ticker: FET
  • Exchange: NYSE
  • Founded: 2005
  • Industry: Oil and Gas Equipment and Services
  • Sector: Energy
  • Implied Market Cap: US$150.121m
  • Shares outstanding: 5.72m
  • Website: https://www.f-e-t.com

Number of Employees


Location

  • Forum Energy Technologies, Inc.
  • 10344 Sam Houston Park Drive
  • Suite 300
  • Houston
  • Texas
  • 77064
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/12 00:00
End of Day Share Price2022/08/12 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.