Weatherford Int'l (WFT) Stock Gains on Rising Oil Prices

Weatherford Int'l (WFT) stock is up in late afternoon trading on Wednesday, amid increasing oil prices.
By Amanda Albright ,

NEW YORK (TheStreet) -- WeatherfordInternational  (WFT) - Get Report stock is surging by 4.14% to $10.81 in afternoon trading on Wednesday, as oil prices recover after slipping below $40 per barrel.

An Energy Information Administration report today showed U.S. crude inventories increased by 252,000 barrels last week, compared to analysts expectations for an increase of 2 million barrels, Reuters reports.

"This week's data point is unlikely going to relieve the selling pressure on the oil markets with U.S. stocks at record levels for this time of year and knocking on the all-time high set earlier in the year," Chris Jarvis, analyst at CaprockRisk Management, told Reuters.

Crude oil (WTI) is up by 0.64% to $40.93 per barrel and Brent oil is higher by 1.74% to $44.33 per barrel, according to the CNBC.com index.

Based in Houston, Weatherford is one of the largest international oil and natural gas service companies.

Separately, TheStreet Ratings team rates WEATHERFORD INTL PLC as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:

We rate WEATHERFORD INTL PLC (WFT) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Energy Equipment & Services industry. The net income has significantly decreased by 320.8% when compared to the same quarter one year ago, falling from $77.00 million to -$170.00 million.
  • The debt-to-equity ratio of 1.36 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, WFT has a quick ratio of 0.64, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Energy Equipment & Services industry and the overall market, WEATHERFORD INTL PLC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for WEATHERFORD INTL PLC is currently lower than what is desirable, coming in at 29.77%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -7.59% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to $134.00 million or 61.71% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • You can view the full analysis from the report here: WFT

Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.

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