National Energy Services Reunited Q2 revenue, profit beat estimates

Overview

• NESR Q2 revenue grows 0.7% YoY, beating analyst expectations

• Adjusted net income for Q2 beats estimates, reaching $20.1 mln

• Adjusted EBITDA rises 13% sequentially, exceeding analyst forecasts

Outlook

• Company anticipates steady growth due to countercyclical investment strategy

• NESR expects continued leadership in Production Services and growth in Drilling

• Company sees diversified country and technology mix driving future revenue

Result Drivers

• DIVERSIFIED MIX - Revenue growth driven by diversified country and technology mix despite global headwinds, per CFO Stefan Angeli

• COST CONTROL - Sequential net income improvement attributed to cost control measures and incremental revenue from existing equipment and personnel

• OPERATIONAL EXECUTION - Strong operational execution reflected in 13% sequential increase in adjusted EBITDA and improved margins

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the oil related services and equipment peer group is "buy"

• Wall Street's median 12-month price target for National Energy Services Reunited Corp is $12.00, about 39.3% above its August 19 closing price of $7.29

• The stock recently traded at 7 times the next 12-month earnings vs. a P/E of 5 three months ago

Press Release: ID:nACS1pYlda