Why Patterson-UTI Energy's Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of drilling contractor Patterson-UTI Energy (NASDAQ: PTEN  ) jumped as much as 12% today, after the company released earnings.

So what: Revenue fell 9.9% from a year ago, to $652.8 million, but that was well ahead of the $599.5 million analysts expected. Net income fell 33%, to $58.9 million, or $0.40 per share, which was $0.12 better than estimates.  

Now what: Sometimes, it's more about expectations than where your results are headed, and that's the case for Patterson today. Drilling has been down in recent quarters, partly because explorers are becoming more efficient -- so the bar had been set fairly low. The earnings beat was good, but with shares still trading at 10.5 times trailing earnings, and profit dropping, I'm not a buyer today. I'll need to see drilling pick up to jump in on this one.

Interested in more info on Patterson-UTI Energy? Add it to your watchlist by clicking here.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2243994, ~/Articles/ArticleHandler.aspx, 12/20/2014 5:25:14 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement