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Why Is Cactus, Inc. (WHD) Up 13.4% Since Last Earnings Report?
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A month has gone by since the last earnings report for Cactus, Inc. (WHD - Free Report) . Shares have added about 13.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Cactus, Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Cactus Q4 Earnings Surpass Estimates
Cactus reported fourth-quarter adjusted earnings of 25 cents per share, beating the Zacks Consensus Estimate of 20 cents. The bottom line increased from the year-ago quarter’s 8 cents.
Total quarterly revenues of $130 million beat the Zacks Consensus Estimate of $123 million. The top line improved from the year-ago quarter’s $68 million.
The fourth-quarter results were driven by increased customer drilling activity and the usage of the firm’s rental equipment.
Dividend Increase
This January, Cactus’ board declared a quarterly cash dividend of 11 cents per share. This reflects an increment of 10% from the prior dividend payout. The dividend will be paid out on Mar 17 to shareholders of record as of Feb 28.
Business Segments
From the Product business, Cactus generated revenues of $83.8 million, increasing from $43 million in the December-end quarter of 2020. Gross profit from the business unit was recorded at $29 million, up from the year-ago quarter’s $13.3 million. The segment was supported by increased customer drilling activity.
Cactus’ Rental revenues were recorded at $19.2 million, up from $8.6 million in the year-ago quarter. Gross income from the Rental unit turned around to a profit of $4.7 million from the year-ago loss of $0.8 million. The segment was supported by the surge in the usage of the firm’s rental equipment.
From the Field Service and Other business segment, Cactus generated revenues of $26.9 million, up from $16.5 million in the year-ago quarter. Gross profit from the business unit was $4.9 million, down 1.5% year over year owing to reduced labor utilization. Higher billable hours and ancillary services offset the positives partially.
Expenses
The cost of product revenues was recorded at $54.8 million, which jumped from $29.8 million in the year-ago quarter. Also, the cost of rental revenues was reported at $14.6 million, up from $9.4 million in the December-end quarter of 2020. The cost of field service and other revenues increased to $22 million from $11.5 million a year ago. As such, total expenses jumped to $104.2 million from the year-ago level of $59.7 million.
Capex and Cash Flow
Cactus’ fourth-quarter 2021 cash investment amount was recorded at $3.2 million. For the reported quarter, operating cash flow was $11.7 million.
Balance Sheet
At the fourth quarter-end, Cactus had cash and cash equivalents of $301.7 million. It has no bank debt outstanding as of Dec 31, 2021.
Guidance
Cactus expects the pace of the addition of rigs in oil and gas resources to remain healthy, considering that the pricing environment of commodities is supportive. Being a manufacturer and designer of highly engineered wellhead and pressure control equipment, Cactus expects revenue growth to continue across all of its business lines in the March quarter of this year.
For 2022, Cactus is projecting net capital expenditures in the band of $20 million to $30 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
VGM Scores
At this time, Cactus, Inc. has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Cactus, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Cactus, Inc. (WHD) Up 13.4% Since Last Earnings Report?
A month has gone by since the last earnings report for Cactus, Inc. (WHD - Free Report) . Shares have added about 13.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Cactus, Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Cactus Q4 Earnings Surpass Estimates
Cactus reported fourth-quarter adjusted earnings of 25 cents per share, beating the Zacks Consensus Estimate of 20 cents. The bottom line increased from the year-ago quarter’s 8 cents.
Total quarterly revenues of $130 million beat the Zacks Consensus Estimate of $123 million. The top line improved from the year-ago quarter’s $68 million.
The fourth-quarter results were driven by increased customer drilling activity and the usage of the firm’s rental equipment.
Dividend Increase
This January, Cactus’ board declared a quarterly cash dividend of 11 cents per share. This reflects an increment of 10% from the prior dividend payout. The dividend will be paid out on Mar 17 to shareholders of record as of Feb 28.
Business Segments
From the Product business, Cactus generated revenues of $83.8 million, increasing from $43 million in the December-end quarter of 2020. Gross profit from the business unit was recorded at $29 million, up from the year-ago quarter’s $13.3 million. The segment was supported by increased customer drilling activity.
Cactus’ Rental revenues were recorded at $19.2 million, up from $8.6 million in the year-ago quarter. Gross income from the Rental unit turned around to a profit of $4.7 million from the year-ago loss of $0.8 million. The segment was supported by the surge in the usage of the firm’s rental equipment.
From the Field Service and Other business segment, Cactus generated revenues of $26.9 million, up from $16.5 million in the year-ago quarter. Gross profit from the business unit was $4.9 million, down 1.5% year over year owing to reduced labor utilization. Higher billable hours and ancillary services offset the positives partially.
Expenses
The cost of product revenues was recorded at $54.8 million, which jumped from $29.8 million in the year-ago quarter. Also, the cost of rental revenues was reported at $14.6 million, up from $9.4 million in the December-end quarter of 2020. The cost of field service and other revenues increased to $22 million from $11.5 million a year ago. As such, total expenses jumped to $104.2 million from the year-ago level of $59.7 million.
Capex and Cash Flow
Cactus’ fourth-quarter 2021 cash investment amount was recorded at $3.2 million. For the reported quarter, operating cash flow was $11.7 million.
Balance Sheet
At the fourth quarter-end, Cactus had cash and cash equivalents of $301.7 million. It has no bank debt outstanding as of Dec 31, 2021.
Guidance
Cactus expects the pace of the addition of rigs in oil and gas resources to remain healthy, considering that the pricing environment of commodities is supportive. Being a manufacturer and designer of highly engineered wellhead and pressure control equipment, Cactus expects revenue growth to continue across all of its business lines in the March quarter of this year.
For 2022, Cactus is projecting net capital expenditures in the band of $20 million to $30 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
VGM Scores
At this time, Cactus, Inc. has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Cactus, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.