Today's Post-Market Laggard Is Patterson-UTI Energy (PTEN)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Patterson-UTI Energy ( PTEN) as a post-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Patterson-UTI Energy as such a stock due to the following factors:

  • PTEN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $102.1 million.
  • PTEN is down 5% today from today's close.

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More details on PTEN:

Patterson-UTI Energy, Inc., through its subsidiaries, provides onshore contract drilling services to major and independent oil and natural gas operators in the United States and Canada. The company operates through three segments: Contract Drilling, Pressure Pumping, and Oil and Natural Gas. The stock currently has a dividend yield of 1.2%. PTEN has a PE ratio of 26.7. Currently there are 6 analysts that rate Patterson-UTI Energy a buy, 1 analyst rates it a sell, and 5 rate it a hold.

The average volume for Patterson-UTI Energy has been 2.2 million shares per day over the past 30 days. Patterson-UTI Energy has a market cap of $4.8 billion and is part of the basic materials sector and energy industry. The stock has a beta of 1.72 and a short float of 2.5% with 0.84 days to cover. Shares are up 30.9% year-to-date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Patterson-UTI Energy as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 33.1% when compared to the same quarter one year prior, rising from $40.77 million to $54.28 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 20.6%. Since the same quarter one year prior, revenues rose by 14.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • PTEN's debt-to-equity ratio is very low at 0.24 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 1.26, which illustrates the ability to avoid short-term cash problems.
  • Powered by its strong earnings growth of 32.14% and other important driving factors, this stock has surged by 65.20% over the past year, outperforming the rise in the S&P 500 Index during the same period. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • PATTERSON-UTI ENERGY INC has improved earnings per share by 32.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, PATTERSON-UTI ENERGY INC reported lower earnings of $1.28 versus $1.95 in the prior year. This year, the market expects an improvement in earnings ($1.57 versus $1.28).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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