Global Hunter downgrades quintet of oilfield services stocks

|By:, SA News Editor

Onshore-focused oil service companies have been strong stock gainers YTD, but Global Hunter thinks it's prudent to take some chips off the table as it downgrades Halliburton (HAL -2.9%), Pioneer Energy (PES -5.3%), Key Energy (KEG -4.2%), Basic Energy (BAS -1.7%) and Superior Energy (SPN -2.5%) to Neutral (

The firm sees activity up next year, but believes expectations of 10%-plus D&C capex growth and 20%-plus EBIT improvement on ~40% incremental margins for the group has set a high bar, particularly when pricing is unlikely to move back in favor and given its belief the rate of change to Street numbers likely has a bias lower.