Piper Sandler raises National Energy Services Reunited stock price target on MENA growth

Investing.com - Piper Sandler raised its price target on National Energy Services Reunited (NASDAQ:NESR) stock to $13.00 from $11.00 on Thursday, while maintaining an Overweight rating on the shares. According to InvestingPro data, the company maintains a "FAIR" overall financial health score, with particularly strong marks in profitability metrics.

The oil services company’s stock jumped 14% following the announcement, significantly outperforming the Oil Services ETF (OIH), which remained flat during the session. The positive market reaction came despite Piper Sandler trimming its 2025 and 2026 EBITDA estimates by 5% and 4%, respectively. InvestingPro analysis shows the stock has delivered strong returns recently, with a 5.56% gain in the past week, though technical indicators suggest the stock may be entering overbought territory.

The research firm cited building momentum across the Middle East and North Africa (MENA) region as the primary driver for the price target increase, creating what it described as a favorable setup into 2026. Management expects all of the company’s operating regions to perform either flat or better compared to 2025 levels.

Piper Sandler highlighted several positive factors in its analysis, including signs of Saudi Arabia’s market bottoming out, strong growth in Kuwait, and positive directional movement in the UAE, Iraq, Oman, Algeria, and Libya. The firm also noted the company’s solid free cash flow, ongoing deleveraging efforts, and remediation of material weaknesses.

For the remainder of 2025, National Energy Services Reunited plans to refinance its debt facility and use excess cash flow to reduce debt before considering shareholder return options, which Piper Sandler suggests will likely become a focus in 2026. Management expressed confidence in organically reaching a $2 billion revenue run-rate over the next couple of years. The company’s debt management strategy appears prudent, with current debt-to-capital ratio at 0.25. Get access to more detailed financial metrics and 8 additional key ProTips for NESR through InvestingPro, including comprehensive analysis of the company’s growth potential and market position.

In other recent news, National Energy Services Reunited reported second-quarter earnings that surpassed expectations, showcasing resilience amid global market challenges. The company’s adjusted earnings per share reached $0.21, exceeding the analyst estimate of $0.18. Revenue for the quarter amounted to $327.4 million, surpassing the consensus estimate of $315.97 million. This reflects an 8.0% sequential increase from the first quarter and a modest 0.7% year-over-year growth. These results highlight improved operational efficiency and sequential revenue growth. Analysts had anticipated a challenging quarter, but the company managed to deliver stronger-than-expected financial performance. This development is notable for investors monitoring the company’s ability to navigate market conditions.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.