Helmerich & Payne, Inc.

HP

Drilling Oil & Gas Wells

Mkt Cap

$3.785B

PE

10.80

Debt

$545.4M

Cash

$262.2M

EV

$4.068B

FCF

$357.2M

Market Cap

$3.785B

P/E Ratio

10.80

Debt

$545.4M

Cash

$262.2M

EV

$4.068B

FCF

$357.2M

Charts data: {"Earnings":[{"time":"2014-09-29","value":704574000},{"time":"2015-09-29","value":420051000},{"time":"2016-09-29","value":-58686000},{"time":"2017-09-29","value":-130023000},{"time":"2018-09-29","value":478326000},{"time":"2019-09-29","value":-36758000},{"time":"2020-09-29","value":-497144000},{"time":"2021-09-29","value":-327500000},{"time":"2022-09-29","value":5445000},{"time":"2023-09-29","value":428237000}],"Sales":[{"time":"2014-09-29","value":3719707000},{"time":"2015-09-29","value":3165441000},{"time":"2016-09-29","value":1624232000},{"time":"2017-09-29","value":1804741000},{"time":"2018-09-29","value":2487268000},{"time":"2019-09-29","value":2798490000},{"time":"2020-09-29","value":1773927000},{"time":"2021-09-29","value":1218568000},{"time":"2022-09-29","value":2058944000},{"time":"2023-09-29","value":2872421000}],"Net Margins":[{"time":"2014-09-29","value":0.18941653200104203},{"time":"2015-09-29","value":0.13269904572538235},{"time":"2016-09-29","value":-0.036131537859123576},{"time":"2017-09-29","value":-0.07204524084065247},{"time":"2018-09-29","value":0.1923097953256344},{"time":"2019-09-29","value":-0.01313494062869619},{"time":"2020-09-29","value":-0.280250540185701},{"time":"2021-09-29","value":-0.26875808325838196},{"time":"2022-09-29","value":0.0026445595412017036},{"time":"2023-09-29","value":0.14908573638752814}],"Assets":[{"time":"2014-09-29","value":6721861000},{"time":"2015-09-29","value":7152012000},{"time":"2016-09-29","value":6832019000},{"time":"2017-09-29","value":6439988000},{"time":"2018-09-29","value":6214867000},{"time":"2019-09-29","value":5839515000},{"time":"2020-09-29","value":4829621000},{"time":"2021-09-29","value":5034128000},{"time":"2022-09-29","value":4355531000},{"time":"2023-09-29","value":4381956000}],"Stockholders Equity":[{"time":"2014-09-29","value":4890977000},{"time":"2015-09-29","value":4897452000},{"time":"2016-09-29","value":4560925000},{"time":"2017-09-29","value":4164591000},{"time":"2018-09-29","value":4382735000},{"time":"2019-09-29","value":4012223000},{"time":"2020-09-29","value":3318514000},{"time":"2021-09-29","value":2912618000},{"time":"2022-09-29","value":2765472000},{"time":"2023-09-29","value":2771943000}],"ROE":[{"time":"2014-09-29","value":0.1440558808597955},{"time":"2015-09-29","value":0.08576929391038442},{"time":"2016-09-29","value":-0.012867126734160286},{"time":"2017-09-29","value":-0.0312210730897704},{"time":"2018-09-29","value":0.10913869992139612},{"time":"2019-09-29","value":-0.00916150473191545},{"time":"2020-09-29","value":-0.14980922183844939},{"time":"2021-09-29","value":-0.11244179634953845},{"time":"2022-09-29","value":0.0019689224841184434},{"time":"2023-09-29","value":0.15448982897555974}],"ROA":[{"time":"2014-09-29","value":0.16378916493512735},{"time":"2015-09-29","value":0.09448390187264787},{"time":"2016-09-29","value":-0.0038006334584256866},{"time":"2017-09-29","value":-0.026792130668566463},{"time":"2018-09-29","value":0.005084903667286846},{"time":"2019-09-29","value":0.003524607779926929},{"time":"2020-09-29","value":-0.12841318190392165},{"time":"2021-09-29","value":-0.08512874523651365},{"time":"2022-09-29","value":0.010398732094892678},{"time":"2023-09-29","value":0.1354141848982509}]}

Helmerich & Payne, Inc., together with its subsidiaries, provides drilling services and solutions for exploration and production companies. The company operates through three segments: North America Solutions, Offshore Gulf of Mexico, and International Solutions. The North America Solutions segment drills primarily in Colorado, Louisiana, Montana, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Texas, Utah, West Virginia, and Wyoming. The Offshore Gulf of Mexico segment has drilling operations in Louisiana and in U.S. federal waters in the Gulf of Mexico. The International Solutions segment conducts drilling operations in Argentina, Bahrain, Colombia, and the United Arab Emirates. As of September 30, 2022, the company operated a fleet of 236 land rigs in North America; 28 international land rigs; and 7 offshore platform rigs. It also focuses on developing, promoting, and commercializing technologies designed to enhance the drilling operations, as well as wellbore quality and placement. In addition, the company owns and operates commercial real estate properties. Its real estate investments include a shopping center comprising approximately 366,000 leasable square feet; and approximately 176 acres of undeveloped real estate located in Tulsa, Oklahoma. The company was founded in 1920 and is headquartered in Tulsa, Oklahoma.

Sector

10-K
9/30/23
10-Q
6/30/23
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12/31/22
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12/31/19
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10-Q
12/31/18
10-K
9/30/18
10-Q
6/30/18
10-Q
3/31/18
10-Q
12/31/17

DCF

Discounted Cash Flow Valuation of Helmerich & Payne, Inc.

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$357.2M	$354.7M	$352.2M	$349.7M	$347.2M	$344.8M	$342.4M	$340M	$337.6M	$335.2M	$332.8M	$3.328B
DCF		$308.4M	$266.3M	$229.9M	$198.5M	$171.4M	$148M	$127.8M	$110.4M	$95.28M	$82.27M	$822.7M
Value	$2.561B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth -5.4%

Earnings Stability -69%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Over time the ROA has been increasing indicating a higher marginal ROA with respect to the calculated one, giving a good sign for continued growth.

Years	09-2015	09-2016	09-2017	09-2018	09-2019	09-2020	09-2021	09-2022	09-2023	TTM
Net Margin	13%	-3.6%	-7.2%	19%	-1.3%	-28%	-27%	0.26%	15%	13%
ROA	9.4%	-0.38%	-2.7%	0.51%	0.35%	-13%	-8.5%	1%	14%	11%
ROE	8.6%	-1.3%	-3.1%	11%	-0.92%	-15%	-11%	0.2%	15%	13%

What is the average Net Margin?

The average Net Margin over the past 5 years is -3.64%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -0.45%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is -0.99%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is +2.04%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is -0.1%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is +0.85%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Under the assumption that FCF does not diminish and debt does not increase, the current years to repay the debt are acceptable.

The Graham’s stability indicate a relevant drawdown, consider checking when it has occured and why.

Years	09-2015	09-2016	09-2017	09-2018	09-2019	09-2020	09-2021	09-2022	09-2023	TTM
Debt FCF	2.03	1.01	-12.44	6.40	1.23	1.22	27.98	-32.53	1.24	1.53
Debt Equity	0.12	0.11	0.12	0.11	0.12	0.15	0.52	0.20	0.20	0.19
MIN
Graham Stability	-	-	-37%	100%	-38%	-480%	-	-	-	-480%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 1.53.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -2.87.

What is the Graham’s Stability?

Graham’s Stability measure stands at -4.79.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has been increasing in past years.

Years	09-2016	09-2018	09-2020	09-2022	Trend
Revenue	8.5%	2.9%	17%	40%	6.9%
Net Income	-	-2.2%	-	7.8K%	980%
Stockholders Equity	-6.9%	-8.8%	-5.8%	0.23%	-0.4%
FCF	-1.8%	41%	3.2%	-	-12%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +2.92%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +6.86%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is -2.19%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is +975.64%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is -8.76%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -0.4%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +41.19%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is -11.5%.