Cactus (NYSE:WHD) - Share price, News & Analysis

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

WHD ($45.52) is trading below our estimate of [[fair value]] ($98.54)

WHD fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	5/6
Past Performance	5/6
Financial Health	6/6
Dividends	2/6

WHD Stock Overview

Cactus, Inc. designs, manufactures, sells, and rents a range of wellheads and pressure control equipment in the United States, Australia, China, and the Kingdom of Saudi Arabia.

Rewards

Trading at 53.8% below our estimate of its fair value

Earnings are forecast to grow 36.53% per year

Earnings grew by 140.2% over the past year

Risk Analysis

No risks detected for WHD from our risk checks.

Cactus Competitors

ProFrac Holding

NasdaqGS:PFHC

US$2.5b

NexTier Oilfield Solutions

NYSE:NEX

US$2.1b

RPC

NYSE:RES

US$1.7b

Archrock

NYSE:AROC

US$1.1b

Price History & Performance

Summary of all time highs, changes and price drops for Cactus
Historical stock prices
Current Share Price	US$45.52
52 Week High	US$64.18
52 Week Low	US$34.70
Beta	1.97
1 Month Change	8.20%
3 Month Change	14.52%
1 Year Change	15.74%
3 Year Change	64.69%
5 Year Change	n/a
Change since IPO	124.79%

Recent News & Updates

Aug 07

Cactus' (NYSE:WHD) Dividend Will Be $0.11

Cactus, Inc. ( NYSE:WHD ) has announced that it will pay a dividend of $0.11 per share on the 15th of September. This...

Shareholder Returns

	WHD	US Energy Services	US Market
7D	15.7%	15.2%	4.4%
1Y	15.7%	12.5%	-18.2%

Return vs Industry: WHD exceeded the US Energy Services industry which returned 12.5% over the past year.

Return vs Market: WHD exceeded the US Market which returned -18.2% over the past year.

Price Volatility

Is WHD's price volatile compared to industry and market?
WHD volatility
WHD Average Weekly Movement	8.5%
Energy Services Industry Average Movement	8.8%
Market Average Movement	6.9%
10% most volatile stocks in US Market	15.5%
10% least volatile stocks in US Market	2.8%

Stable Share Price: WHD is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: WHD's weekly volatility (8%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2011	1,000	Scott Bender	https://www.cactuswhd.com

Cactus, Inc. designs, manufactures, sells, and rents a range of wellheads and pressure control equipment in the United States, Australia, China, and the Kingdom of Saudi Arabia. The company’s principal products include Cactus SafeDrill wellhead systems, Cactus SafeLink monobore, SafeClamp, and SafeInject systems, as well as frac stacks, zipper manifolds, and production trees. It also provides field services, such as 24-hour service crews to assist with the installation, maintenance, repair, and safe handling of the wellhead and pressure control equipment; and repair and refurbishment services.

Cactus Fundamentals Summary

How do Cactus's earnings and revenue compare to its market cap?
WHD fundamental statistics
Market Cap	US$3.41b
Earnings (TTM)	US$75.40m
Revenue (TTM)	US$561.39m

36.6x

P/E Ratio

4.9x

P/S Ratio

Is WHD overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
WHD income statement (TTM)
Revenue	US$561.39m
Cost of Revenue	US$385.84m
Gross Profit	US$175.55m
Other Expenses	US$100.15m
Earnings	US$75.40m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	1.24
Gross Margin	31.27%
Net Profit Margin	13.43%
Debt/Equity Ratio	0%

How did WHD perform over the long term?

See historical performance and comparison

Dividends

1.0%

Current Dividend Yield

33%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is WHD 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-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings 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 WHD?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for WHD. This is calculated by dividing WHD's market cap by their current preferred multiple.
What is WHD's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$3.41b

WHD 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/Revenue	4.6x
Enterprise Value/EBITDA	16.6x
PEG Ratio	1x

Price to Earnings Ratio vs Peers

How does WHD's PE Ratio compare to its peers?

WHD PE Ratio vs Peers

The above table shows the PE ratio for WHD vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	28.8x
PFHC ProFrac Holding	9.9x	91.8%	US$2.5b
NEX NexTier Oilfield Solutions	49.3x	60.3%	US$2.1b
RES RPC	21.6x	27.2%	US$1.7b
AROC Archrock	34.4x	15.8%	US$1.1b
WHD Cactus	36.6x	36.5%	US$3.4b

Price-To-Earnings vs Peers: WHD is expensive based on its Price-To-Earnings Ratio (36.6x) compared to the peer average (28.8x).

Price to Earnings Ratio vs Industry

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

Price-To-Earnings vs Industry: WHD is expensive based on its Price-To-Earnings Ratio (36.6x) compared to the US Energy Services industry average (26.2x)

Price to Earnings Ratio vs Fair Ratio

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

WHD PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	36.6x
Fair PE Ratio	26.1x

Price-To-Earnings vs Fair Ratio: WHD is expensive based on its Price-To-Earnings Ratio (36.6x) compared to the estimated Fair Price-To-Earnings Ratio (26.1x).

Share Price vs Fair Value

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

Below Fair Value: WHD ($45.52) is trading below our estimate of fair value ($98.54)

Significantly Below Fair Value: WHD is trading below fair value by more than 20%.

Analyst Price Targets

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

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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Future Growth

How is Cactus forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

36.5%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: WHD's forecast earnings growth (36.5% per year) is above the savings rate (1.9%).

Earnings vs Market: WHD's earnings (36.5% per year) are forecast to grow faster than the US market (14.8% per year).

High Growth Earnings: WHD's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: WHD's revenue (14.6% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: WHD's revenue (14.6% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: WHD's Return on Equity is forecast to be high in 3 years time (25%)

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Past Performance

How has Cactus performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-2.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: WHD has high quality earnings.

Growing Profit Margin: WHD's current net profit margins (13.4%) are higher than last year (9.8%).

Past Earnings Growth Analysis

Earnings Trend: WHD has become profitable over the past 5 years, growing earnings by -2% per year.

Accelerating Growth: WHD's earnings growth over the past year (140.2%) exceeds its 5-year average (-2% per year).

Earnings vs Industry: WHD earnings growth over the past year (140.2%) exceeded the Energy Services industry 44.1%.

Return on Equity

High ROE: WHD's Return on Equity (15.6%) is considered low.

Discover strong past performing companies

Financial Health

How is Cactus's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: WHD's short term assets ($594.5M) exceed its short term liabilities ($113.6M).

Long Term Liabilities: WHD's short term assets ($594.5M) exceed its long term liabilities ($312.7M).

Debt to Equity History and Analysis

Debt Level: WHD is debt free.

Reducing Debt: WHD currently has no debt however we can't compare to 5 years ago as we have no data for that period.

Debt Coverage: WHD has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: WHD has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Cactus's current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

0.97%

Current Dividend Yield

Dividend Yield vs Market

Cactus Dividend Yield vs Market

How does Cactus dividend yield compare to the market?
Segment	Dividend Yield
Company (Cactus)	1.0%
Market Bottom 25% (US)	1.6%
Market Top 25% (US)	4.5%
Industry Average (Energy Services)	2.1%
Analyst forecast in 3 Years (Cactus)	0.9%

Notable Dividend: WHD's dividend (0.97%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.6%).

High Dividend: WHD's dividend (0.97%) is low compared to the top 25% of dividend payers in the US market (4.53%).

Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, WHD has been paying a dividend for less than 10 years.

Growing Dividend: WHD's dividend payments have increased, but the company has only paid a dividend for 3 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (33%), WHD's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (71.8%), WHD's dividend payments are covered by cash flows.

Discover strong dividend paying companies

Management

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

3.6yrs

Average management tenure

CEO

Scott Bender (68 yo)

11.75yrs

Tenure

US$2,031,846

Compensation

Mr. Scott J. Bender has been President, Chief Executive Officer and Director of Cactus, Inc. since 2011. He is the President and Chief Executive Officer of Cactus Wellhead, LLC. Mr. Bender founded Cactus L...

CEO Compensation Analysis

Scott Bender's Compensation vs Cactus Earnings

How has Scott Bender's remuneration changed compared to Cactus's earnings?
Date	Total Comp.	Salary	Company Earnings
Jun 30 2022	n/a	n/a	US$75m
Mar 31 2022	n/a	n/a	US$59m
Dec 31 2021	US$2m	US$225k	US$50m
Sep 30 2021	n/a	n/a	US$38m
Jun 30 2021	n/a	n/a	US$31m
Mar 31 2021	n/a	n/a	US$27m
Dec 31 2020	US$2m	US$123k	US$34m
Sep 30 2020	n/a	n/a	US$49m
Jun 30 2020	n/a	n/a	US$62m
Mar 31 2020	n/a	n/a	US$78m
Dec 31 2019	US$2m	US$300k	US$86m
Sep 30 2019	n/a	n/a	US$84m
Jun 30 2019	n/a	n/a	US$84m
Mar 31 2019	n/a	n/a	US$75m
Dec 31 2018	US$2m	US$300k	US$52m
Sep 30 2018	n/a	n/a	US$101m
Jun 30 2018	n/a	n/a	US$83m
Mar 31 2018	n/a	n/a	US$70m
Dec 31 2017	US$585k	US$260k	US$67m

Compensation vs Market: Scott's total compensation ($USD2.03M) is below average for companies of similar size in the US market ($USD6.80M).

Compensation vs Earnings: Scott's compensation has increased by more than 20% in the past year.

Leadership Team

Experienced Management: WHD's management team is considered experienced (3.6 years average tenure).

Board Members

Experienced Board: WHD's board of directors are considered experienced (7.8 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

NYSE:WHD Recent Insider Transactions by Companies or Individuals
Date	Value	Name	Entity	Shares	Max Price
07 Jun 22	SellUS$30,386,944	Scott Bender	Individual	562,336	US$55.04
07 Jun 22	SellUS$29,286,144	Joel Bender	Individual	542,336	US$54.00
27 May 22	SellUS$1,304,832	Scott Bender	Individual	24,680	US$52.87
26 May 22	SellUS$2,083,054	Steven Bender	Individual	40,259	US$52.72
23 May 22	SellUS$1,001,400	Steven Bender	Individual	20,000	US$50.07
19 May 22	SellUS$960,000	Steven Bender	Individual	20,000	US$48.00
19 May 22	SellUS$9,051,355	Joel Bender	Individual	188,784	US$48.00
19 May 22	SellUS$8,640,000	Scott Bender	Individual	180,000	US$48.00
19 May 22	SellUS$746,490	Joel Bender	Individual	15,151	US$49.27
18 May 22	SellUS$1,159,382	Michael McGovern	Individual	24,024	US$49.35
16 May 22	SellUS$976,800	Alan Semple	Individual	20,000	US$48.84
15 Mar 22	SellUS$1,048,074	Steven Bender	Individual	19,741	US$55.99
10 Mar 22	SellUS$86,768	Donna Anderson	Individual	1,496	US$58.00
08 Mar 22	SellUS$420,750	Gary Rosenthal	Individual	7,000	US$60.12
08 Mar 22	SellUS$319,308	David Isaac	Individual	5,091	US$62.72
08 Mar 22	SellUS$1,636,784	Stephen Tadlock	Individual	26,022	US$62.90

Ownership Breakdown

What is the ownership structure of WHD?
Owner Type	Number of Shares	Ownership Percentage
Private Companies	8,202	0.01%
Individual Insiders	375,508	0.6%
Institutions	65,110,685	99.4%

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

Top Shareholders

Top 25 shareholders own 78.99% of the company

Ownership	Name	Shares	Current Value	Change %	Portfolio %
9.17%	The Vanguard Group, Inc.	5,560,176	$253.1m	-1.25%	0.01%
8.84%	T. Rowe Price Group, Inc.	5,359,583	$244.0m	-4.45%	0.03%
7.04%	BlackRock, Inc.	4,265,490	$194.2m	6.98%	no data
5.47%	AllianceBernstein L.P.	3,314,913	$150.9m	-25.44%	0.06%
4.58%	Van Eck Associates Corporation	2,776,221	$126.4m	-7.03%	0.23%
4.31%	BNY Mellon Asset Management	2,610,293	$118.8m	0.63%	0.02%
3.3%	ClearBridge Investments, LLC	2,002,158	$91.1m	0.06%	0.08%
3.09%	J.P. Morgan Asset Management, Inc.	1,874,718	$85.3m	82.63%	0.01%
2.97%	Wellington Management Group LLP	1,800,359	$82.0m	33.09%	0.01%
2.9%	Brown Advisory Incorporated	1,758,458	$80.0m	0.36%	0.13%
2.35%	Boston Trust Walden Company	1,427,349	$65.0m	38.06%	0.57%
2.35%	State Street Global Advisors, Inc.	1,424,225	$64.8m	2.33%	no data
2.1%	Channing Capital Management, LLC	1,273,520	$58.0m	20.26%	1.85%
1.94%	Loomis Sayles & Company, L.P.	1,177,924	$53.6m	-0.51%	0.09%
1.9%	Capital Research and Management Company	1,149,091	$52.3m	0%	no data
1.87%	Jennison Associates LLC	1,134,657	$51.6m	7.66%	0.04%
1.73%	Federated Hermes, Inc.	1,047,900	$47.7m	4.46%	0.13%
1.73%	Lazard Asset Management LLC	1,046,889	$47.7m	-12.04%	0.04%
1.69%	Stephens Investment Management Group, LLC	1,023,502	$46.6m	45.92%	0.78%
1.68%	Victory Capital Management Inc.	1,016,099	$46.3m	-20.27%	0.05%
1.65%	Geode Capital Management, LLC	999,455	$45.5m	3.17%	0.01%
1.63%	Macquarie Investment Management Business Trust	989,367	$45.0m	14.97%	0.04%
1.62%	Invesco Ltd.	980,710	$44.6m	21.4%	0.01%
1.57%	Dimensional Fund Advisors LP	952,353	$43.4m	0.19%	0.01%
1.51%	FMR LLC	915,898	$41.7m	61.2%	no data

Ticker	Exchange	Primary Security	Security Type	Country	Currency	Listed on
WHD	NYSE (New York Stock Exchange)	Yes	Class A Common Stock	US	USD	Feb 2018
43C	DB (Deutsche Boerse AG)	Yes	Class A Common Stock	DE	EUR	Feb 2018

Data	Last Updated (UTC time)
Company Analysis	2022/10/05 00:00
End of Day Share Price	2022/10/05 00:00
Earnings	2022/06/30
Annual Earnings	2021/12/31