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Tuesday, NOV Inc. (NYSE: NOV) maintained a stable outlook according to Stifel analysts. The firm reiterated a Buy rating on the stock with a price target of $23.00, representing potential upside from the current price of $12.14. According to InvestingPro analysis, NOV appears undervalued based on its Fair Value estimate. The analysts’ assessment follows NOV’s first-quarter results for the year 2025, which they consider neutral for the company’s shares.
The oilfield services provider reported an adjusted EBITDA of $252 million for the first quarter, which surpassed Stifel’s forecast by 4.3% and also exceeded the consensus estimate of $248.1 million. The company’s guidance for the second quarter EBITDA is set between $250-280 million, aligning closely with Stifel’s projection of $266.5 million and the consensus of $277.8 million. InvestingPro data shows NOV maintains a strong financial health score of 3.1 (GREAT), with last twelve months EBITDA reaching $1.33 billion.
NOV demonstrated a book-to-bill ratio of 80%, which might indicate potential challenges in order flow against a complex macroeconomic backdrop. Despite this, the company managed to generate $51 million in free cash flow (FCF), significantly outperforming the consensus estimate that predicted a loss of $8.1 million. InvestingPro reveals several positive indicators, including strong liquidity with a current ratio of 2.46 and moderate debt levels. Get access to additional ProTips and comprehensive analysis with an InvestingPro subscription.
The company has also been active in returning capital to its shareholders, with $109 million distributed in the quarter. NOV has expressed its commitment to continue returning 50% of its excess free cash flow to shareholders annually. This ongoing strategy reflects the company’s confidence in its financial stability and its dedication to shareholder value. According to InvestingPro data, NOV has maintained dividend payments for 17 consecutive years, with a current dividend yield of 2.45%.
In other recent news, NOV Inc. reported fourth-quarter results that exceeded expectations, with adjusted earnings per share of $0.41, surpassing analyst estimates of $0.36. The company also reported revenue of $2.31 billion, which was above the forecasted $2.26 billion. NOV’s operating profit increased by 29% year-over-year to $207 million, with an adjusted EBITDA of $302 million, representing 13.1% of sales. For the full year 2024, NOV’s revenue rose by 3% to $8.87 billion, with a net income of $635 million.
In leadership changes, NOV appointed Jose Bayardo as President & Chief Operating Officer and Rodney Reed as Senior Vice President & Chief Financial Officer as part of its succession planning strategy. Analyst firms have also shown confidence in NOV, with RBC Capital Markets upgrading the stock to Outperform and setting a price target of $22. Raymond (NSE:RYMD) James raised its price target for NOV to $19, maintaining an Outperform rating, citing strong free cash flow and order activity. These developments reflect a positive outlook for NOV as it continues to focus on growth and shareholder returns.
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