Cactus, Inc. designs, manufactures, sells, and rents a range of wellheads and pressure control equipment. Its principal products include Cactus SafeDrill wellhead systems, frac stacks, zipper manifolds, and production trees. The company also provides mission-critical field services, including 24-hour service crews to assist with the installation, maintenance, and safe handling of the wellhead and pressure control equipment, as well as repair services for equipment that it sells or rents. It sells or rents its products principally for onshore unconventional oil and gas wells that are utilized during the drilling, completion (including fracturing), and production phases of its customers’ wells. The company operates 14 service centers in the United States, as well as a service center in Eastern Australia. Cactus, Inc. was founded in 2017 and is based in Houston, Texas.
WHD Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Cactus Inc. To summarize, we found that Cactus Inc ranked in the 98th percentile in terms of potential gain offered. Our DCF analysis implies the stock could yield a return of 15130.83% if fairly valued; such returns are always unlikely, though, so further investigation is likely warranted. As for the metrics that stood out in our discounted cash flow analysis of Cactus Inc, consider:
The stock's equity weight, or the proportion of capital from equity relative to debt, is 98. Notably, its equity weight is greater than 94.71% of US equities in the Energy sector yielding a positive free cash flow.
The business' balance sheet suggests that 2% of the company's capital is sourced from debt; this is greater than just 7.68% of the free cash flow producing stocks we're observing.
Cactus Inc's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -173.65. This coverage rate is greater than that of merely 1.54% of stocks we're observing for the purpose of forecasting via discounted cash flows.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Energy that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as WHD, try TGP, AM, WTI, TH, and NBLX.
Cactus (WHD) had declared $0.09/share quarterly dividend, in line with previous.Payable Sept. 17; for shareholders of record Aug. 31; ex-div Aug. 28.See WHD Dividend Scorecard, Yield Chart, & Dividend Growth....
Cactus, Inc. (WHD) Q2 2020 Earnings Conference Call July 30, 2020 10:00 AM ET Company Participants John Fitzgerald - Director of Corporate Development & Investor Relations Scott Bender - Chief Executive Officer Steve Tadlock - Chief Financial Officer Joel Bender - Senior Vice President and Chief Operating Officer Conference Call...
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