The analyst firm downgraded the company to "neutral" from "buy." The downgrade is due to diminishing demand for deepwater and ultra-deepwater rigs. ISI Group also said the dayrates are weaker than the market appreciates.
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- NOV's revenue growth has slightly outpaced the industry average of 7.9%. Since the same quarter one year prior, revenues slightly increased by 8.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- NOV's debt-to-equity ratio is very low at 0.14 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.25, which illustrates the ability to avoid short-term cash problems.
- Net operating cash flow has significantly increased by 89.75% to $1,518.00 million when compared to the same quarter last year. In addition, NATIONAL OILWELL VARCO INC has also vastly surpassed the industry average cash flow growth rate of 22.81%.
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- You can view the full analysis from the report here: NOV Ratings Report