Weatherford International Ltd.NYSE
Weatherford Slowly Changing The Tone
Stephen Simpson, CFA
Stephen Simpson, CFA
4 Reasons Weatherford Could Be A Great Short Play
Tue, Oct. 18, 5:35 PM
Tue, Sep. 27, 11:01 AM
- Weatherford International (WFT -4.6%) says it agrees to pay a $140M fine to settle the previously disclosed SEC investigation over allegedly inflating earnings by using deceptive income tax accounting.
- Two former WFT top accounting execs allegedly made inappropriate adjustments to fill gaps and meet goals for the company's effective tax rate that was touted to analysts and investors; WFT restated its financial statements three times during 2011-12 to correct the misstatements.
Wed, Sep. 7, 3:03 AM
- Don't expect too much out of Q3 oil services results, Credit Suisse says. "While an impressive move off the bottom, the U.S. horizontal rig count is still only 31% of its 2014 average. Not going down anymore is fabulous. But it doesn’t translate into doing well very quickly."
- Still, CS says investors should be more aggressive in buying stocks that miss earnings estimates.
- Firm notes that the focus on efficiency continues. "Sand has replaced land rigs as the under-utilized fixed-cost-base leveraged play on the recovery." Recommends SLCA and HCLP.
- Says that technology and a more efficient client base makes HAL the top “demographic” play over SLB in the near term.
- "BHI and WFT are self-help stories in different stages of improvement, but both have reasons to be in energy portfolios. Manufacturing is challenged with its focus on deepwater, which drives FET as our top pick in the group."
Wed, Jul. 27, 4:36 PM
Tue, Jul. 26, 5:35 PM
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Sat, Jul. 9, 8:25 AM
- Transocean (NYSE:RIG) earlier this week was the first junk-rated company to jump into the bond market since the June 23 Brexit vote, hoping to raise $1.5B, but it ended up trimming the deal to $1.25B and had to boost yields to entice investors.
- RIG’s difficulty would not seem to spell the end of demand for junk bonds, as mutual funds and ETFs that buy the riskier corporate debt saw inflows of $1.8B this week that snapped three weeks of outflows, but it could show that investors remain apprehensive when it comes to energy companies, Bloomberg reports.
- RIG sold $1.25B of 9% seven-year bonds at $0.975 on the dollar, a larger discount than the $0.98-$0.99 at which it initially offered the notes, according to the report - a cool reception that stands in contrast to the enthusiastic greeting for $1.5B of notes sold early last month (I, II, III, IV) by Weatherford (NYSE:WFT).
- Even if more companies are able to issue high-yield debt in the coming weeks, the window of opportunity for other energy issuers may be closed for now, says Bloomberg's Stephen Cutter.
Thu, Jun. 30, 2:37 PM
- Venezuela's PDVSA says it has signed financing agreements with Halliburton (HAL +0.9%) and Weatherford (WFT +0.1%), without offering details on any agreements that had been reached.
- HAL said last month that it was curtailing activity in Venezuela over delays in payments, two weeks after oil services peer Schlumberger (SLB +1.2%) announced a similar move as a result of payment difficulties.
- The local Del Pino publication reported earlier this month that PDVSA was close to reaching a deal with SLB that would boost the company's presence in Venezuela through a new financing scheme.
Fri, Jun. 24, 2:33 PM
- Weatherford (WFT -6.2%) is sharply lower, like all of its oilfield service counterparts, after Imperial Capital initiates coverage with an In-line rating and $7 price target.
- Imperial says that while WFT's recent financing activity eases excessive concerns about liquidity, and stabilizing commodity price trends are encouraging, it prefers more evidence of fundamental improvement in earnings and cash flows to before turning more positive.
- The firm believes WFT has substantial leverage to a potential recovery in E&P activity, with a recovery looking increasingly likely given the recent stabilization in commodity prices as well as early signs of an upturn in rig count.
Fri, Jun. 10, 5:36 PM
Thu, Jun. 9, 2:39 PM
- Weatherford (WFT -0.4%) is lower after announcing it is offering $1B of senior notes, with plans to use the proceeds to increase its recently announced tender offer to $2.1B from $1.1B.
- Citigroup says the refinancing is another positive step for WFT in reducing investor concern about the balance sheet and will provide some room for the company to raise capex and invest in working capital in the years ahead; in fact, few observers believed WFT even could execute an unsecured offering, Citi says.
- The news may suggest that WFT’s free cash flow will disappoint vs. company guidance, but Citi believes the further alleviation of concerns toward debt maturities likely outweighs the read through to free cash generation.
Mon, Jun. 6, 3:39 PM
- Weatherford (WFT +8.3%) is upgraded to Overweight from Equal Weight with an $8 price target, raised from $7, at Barclays following last week's $1.1B convertible debt issue and the settling of the Zubair change order claim for $150M meaningfully shifted the narrative away from the balance sheet, removing considerable downside risk.
- "With near-term liquidity issues resolved, shares of WFT should start to recapture substantial YTD underperformance as focus starts so shift towards potential recovery amid low expectations," Barclays writes.
- However, the firm says WFT remains challenged with a highly levered balance sheet and a weaker operational position vs. the big three oil services companies, as it does not possess the scale in either North America or internationally to compete in markets that are becoming increasingly integrated.
- Oil service (OIH +6.2%) peers also are posting strong gains: SLB +4.5%, HAL +4.6%, BHI +6.8%.
Fri, Jun. 3, 10:09 AM
- Weatherford (WFT +4.6%) is upgraded to Overweight from Neutral with an $8 price target, up from $7.20, at Piper Jaffray, which believes the recent $1.1B senior note offering "redefines the downside from potentially distressing to acceptable."
- The firm says it supports the offering, which "materially improves the financial resilience of the company and allows management to more fully concentrate on running/improving the operational business as opposed to repeatedly being enveloped, with increasing frequency, by serial crises."
Thu, Jun. 2, 7:50 AM
- Weatherford (NYSE:WFT) -4.6% premarket after pricing an upsized public offering of $1.1B of exchangeable senior notes, with an underwriters option to purchase up to an additional $165M of notes; the notes will pay an annual interest rate of 5.875%.
- WFT plans to replace existing bonds due during 2017-20 with new debt with a longer maturity.
- Now read Weatherford kicks the can down the road with new debt
Wed, Jun. 1, 5:41 PM
Fri, May 27, 9:12 AM
Fri, May 6, 2:58 PM
- Weatherford (WFT +0.3%) is downgraded to Market Perform from Outperform at Wells Fargo, which cites increased concern about the company's liquidity position and sees a significantly lower cash flow outlook through 2017.
- But WFT is upgraded to Buy from Neutral at Seaport Global, which argues the company has substantial leverage to an eventual upturn in spending and should see high incremental margins given its strong cost cutting efforts.
- Shares are maintained with a Buy rating at Jefferies, focusing on WFT's earnings power upon recovery even as it admits the combination of lower credit availability and softer free cash flow makes the company's condition more tenuous.
- Shares sank nearly 25% yesterday on concerns over the company's cash flow and growth outlook.
- Now read Weatherford: Highly disappointing cash flow development