NEW YORK (TheStreet) -- Shares of National-Oilwell Varco (NOV - Get Report) traded at a 52-week low of $58.58 today as oil fell to the lowest level in more than 5 1/2 years after Goldman Sachs and Societe Generale reduced their price forecasts, and Venezuela called on OPEC producers to work together to spur a rebound, Bloomberg reports.
West Texas Intermediate was down 4.84% to $46.02, and Brent fell 5.41% to $47.40 at 10:47 a.m. in New York. Crude has to "stay lower for longer" if investment in shale is to be cut back to re-balance the global market, according to Goldman analysts.
Prices need to return to $100 a barrel for economic equilibrium, Venezuelan President Nicolas Maduro said in Iran during a tour of Middle Eastern OPEC members, Bloomberg reports.
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For the oil services industry as a whole, Goldman Sachs made "major cuts" to its macro outlook today. The firm now expects WTI to average $47/bbl in 2015 and stay below $45/bbl before 4Q15, leading analysts to reiterate their "cautious" stance.
Societe Generale also cut its average WTI price for this year to $51 a barrel from $65 with Brent averaging $55 a barrel in 2015, down from a previous estimate of $70.
National Oilwell Varco is a provider of equipment and components used in oil and gas drilling and production operations, oilfield services, and supply chain integration services to the upstream oil and gas industry.
Separately, TheStreet Ratings team rates NATIONAL OILWELL VARCO INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate NATIONAL OILWELL VARCO INC (NOV) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- NOV's revenue growth has slightly outpaced the industry average of 15.9%. Since the same quarter one year prior, revenues rose by 17.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- NOV's debt-to-equity ratio is very low at 0.15 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 1.19, which illustrates the ability to avoid short-term cash problems.
- NATIONAL OILWELL VARCO INC has improved earnings per share by 15.7% 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, NATIONAL OILWELL VARCO INC reported lower earnings of $5.16 versus $5.83 in the prior year. This year, the market expects an improvement in earnings ($6.02 versus $5.16).
- The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Energy Equipment & Services industry average. The net income increased by 9.9% when compared to the same quarter one year prior, going from $636.00 million to $699.00 million.
- You can view the full analysis from the report here: NOV Ratings Report