Nuverra slammed on reverse split, plans to sell TFI

|By:, SA News Editor

It's an ugly session for Nuverra Environmental (NES -32%) after reporting weak Q3 results and a 1:10 reverse split, but at least losses have held steady through the day.

Of $233M in asset writedowns, $98.5M went toward the TFI business bought last year for $245M; NES says it plans to sell the business, an admission that the business never lived up to its billing as a stable source of earnings.

Revenue in the fluids management unit was flat as earnings declined; peers Key Energy (KEG) and Basic Energy Services (BAS) appear to be doing a better job managing current conditions.

On its Q4 outlook, NES says it doesn't expect a material change in overall business activity and believes the typical seasonal slowdown could be greater than normal.

Craig Hallum cuts shares to Sell from Hold after "consistently poor results" and "continued margin compression."