- Oil driller Helmerich & Payne (HP -6.5%) is the day's biggest S&P 500 loser after saying rates for its high-tech rigs have tumbled 10% Q/Q and warns of more softness ahead because of falling crude oil prices.
- "Drilling activity and spot dayrate pricing are now expected to significantly decline in the U.S.," HP says in a presentation which indicates deteriorating utilization and dayrates among land drillers is spreading farther and faster than expected.
- HP says the idle and available number of its FlexRigs has risen to 26 from 15 since Dec. 11, and sees expects to see another 40-50 FlexRigs become idle in the next 30 days from its current total of 287 but does not foresee further idling beyond that point.
- SunTrust analysts think HP’s rig count will wind up lower by the mid-30s in percentage Q/Q, cutting their 2015 EPS estimates on HP to $2.60, well below the consensus of $5.56, and slashing their price target to $56 from $70.
- Credit Suisse's James Wicklund, who offered little optimism for the oil service sector today, also slashed his estimates on land drillers HP, Nabors Industries (NBR -3.6%), Precision Drilling (PDS -2.1%) and Patterson-UTI (PTEN -3.6%) - "the result is ugly."