Microvast Holdings announces departure of chief financial officer
On Monday, Citi analyst Scott Gruber adjusted the price target for Weatherford International plc (NASDAQ:WFRD) to $90.00, down from the previous $95.00, while still recommending the stock as a Buy. Currently trading at $70.23, Weatherford appears undervalued according to InvestingPro analysis, with 5 analysts recently revising their earnings expectations downward. The revision reflects concerns over a more significant downturn in upstream spending in Mexico than initially anticipated.
Gruber's analysis indicates that Halliburton (NYSE:HAL) suggested a potential 25-30% reduction in spending, compared to the 20% decrease that was previously forecasted based on the budget submitted for approval. This expected drop in spending is particularly impactful for Weatherford, as the company earns approximately 12% of its revenue from Mexico, which is a higher proportion than HAL's revenue from the region.
The analyst further noted that Weatherford's revenue from Mexico is believed to be margin accretive, meaning it contributes positively to the company's profit margins. Additionally, Gruber incorporated a larger anticipated decline in activity in Russia, where Weatherford generated around 6% of its 2023 revenues. This is due to potential reductions in activity following production curtailments in the country.
As a result of these adjustments, Gruber forecasts Weatherford's first quarter EBITDA to be $273 million, which is an 8% decrease. This figure would be $285 million when stock compensation is added back, which is below the consensus estimate of $289 million. Looking forward, the analyst's forecast for 2025 EBITDA is now set at $1.18 billion, a 7% reduction, or $1.22 billion with stock compensation included, compared to the consensus estimate of $1.35 billion. Despite these adjustments, InvestingPro analysis reveals several additional bullish indicators and insights available in the comprehensive Pro Research Report, which provides deep-dive analysis of Weatherford and 1,400+ other US stocks.
In other recent news, Weatherford International has seen a series of significant developments. Citi analyst Scott Gruber revised the company's stock price target to $95.00, citing concerns about declining investments in Mexico and oil activity in Saudi Arabia. Despite this, Gruber maintained a Buy rating on the stock. Similarly, Evercore ISI revised its price target for Weatherford to $142.00 but kept its 'Outperform' rating, suggesting a favorable geographical mix and sustained international and offshore market upcycle.
Weatherford's fourth-quarter revenue forecast was adjusted to $1.37 billion, and the EBITDA forecast was reduced to $312 million. The company also reported steady growth in its third-quarter earnings, maintaining an adjusted EBITDA margin of 25.2% and generating an adjusted free cash flow of $184 million.
The company has secured significant contracts in the Middle East, including a three-year contract with the Abu Dhabi National Oil Company for rigless services, and contracts with the Kuwait Oil Company and a National Oil Company in Qatar. These contracts are expected to enhance the operational efficiency and reliability of these companies' assets while improving Weatherford's global market position. These are among the recent developments for Weatherford International.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.