Drilling Oil & Gas Wells
Patterson-UTI Energy, Inc., through its subsidiaries, provides contract drilling services to oil and natural gas operators in the United States and internationally. It operates through three segments: Contract Drilling Services, Pressure Pumping Services, and Directional Drilling Services. The Contract Drilling Services segment markets its contract drilling services primarily in west Texas, Appalachia, Rockies, Oklahoma, South Texas, East Texas, and Colombia. The Pressure Pumping Services segment offers pressure pumping services that consist of well stimulation for the completion of new wells and remedial work on existing wells, as well as hydraulic fracturing, cementing, and acid pumping services in Texas and the Appalachian region. The Directional Drilling Services segment provides a suite of directional drilling services, including directional drilling and measurement-while-drilling services; supply and rental of downhole performance motors; and software and services that enhances the accuracy of directional and horizontal wellbores, wellbore quality, and on-bottom rate of penetration. It also services equipment to drilling contractors, as well as provides electrical controls and automation to the energy, marine, and mining industries in North America and other markets; and owns and invests in oil and natural gas assets as a non-operating working interest owner located principally in Texas and New Mexico. Patterson-UTI Energy, Inc. was founded in 1978 and is headquartered in Houston, Texas.
Discounted Cash Flow Valuation of Patterson Uti Energy Inc
Growth
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Discount
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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 | $412.4M | $448.8M | $486.6M | $525.4M | $565M | $605.3M | $645.9M | $686.4M | $726.6M | $766M | $804.3M | $8.043B |
DCF | $390.3M | $367.9M | $345.4M | $323.1M | $300.9M | $279.2M | $258.1M | $237.5M | $217.7M | $198.8M | $1.988B | |
Value | $4.907B |
In the chart Earnings are multiplied by this value.
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.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | -16% | -35% | 0.24% | -9.7% | -17% | -71% | -48% | 5.8% | 5.9% | 4.1% |
ROA | -9% | -12% | -5.1% | -5.9% | -10% | -27% | -23% | 6.7% | 4.7% | 4.3% |
ROE | -11% | -14% | 0.14% | -9.2% | -15% | -40% | -41% | 9.3% | 5.1% | 4.2% |
The average Net Margin over the past 5 years is -22.47%.
The trend of Net Margin over the past 5 years is +4.87%.
The average ROA over the past 5 years is -9.13%.
The trend of ROA over the past 5 years is +3.1%.
The average ROE over the past 5 years is -15.06%.
The trend of ROE over the past 5 years is +4.1%.
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.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Debt FCF | 3.59 | 3.24 | -3.26 | 12.61 | 2.80 | 6.81 | -12.13 | 6.46 | 3.22 | 3.04 |
Debt Equity | 0.36 | 0.27 | 0.22 | 0.32 | 0.34 | 0.45 | 0.53 | 0.50 | 0.26 | 0.26 |
MIN | ||||||||||
Graham Stability | - | - | - | - | - | - | - | - | - | - |
The Debt/FCF trailing twelve month is 3.04.
The trend of Debt/FCF over the past 5 years is -1.57.
Graham’s Stability measure stands at -.
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.
Years | 12-2016 | 12-2018 | 12-2020 | 12-2022 | Trend |
---|---|---|---|---|---|
Revenue | 24% | 4.5% | 55% | 57% | 7.7% |
Net Income | - | - | - | 59% | - |
Stockholders Equity | 12% | 6.6% | 34% | 190% | 11% |
FCF | 11% | 34% | 43% | 200% | 25% |
The Revenue CAGR over the past 5 years is +4.5%.
The trend of Revenue growth rate over the past 5 years is +7.66%.
The Earnings CAGR over the past 5 years is -.
The trend of Earnings growth rate over the past 5 years is -.
The Equity CAGR over the past 5 years is +6.58%.
The trend of Equity growth rate over the past 5 years is +10.68%.
The FCF CAGR over the past 5 years is +34.33%.
The trend of FCF growth rate over the past 5 years is +25.03%.