Assessing Pioneer Energy Services Corp’s (NYSE:PES) past track record of performance is a valuable exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess PES’s recent performance announced on 30 September 2017 and evaluate these figures to its longer term trend and industry movements. See our latest analysis for Pioneer Energy Services
Did PES beat its long-term earnings growth trend and its industry?
For the most up-to-date info, I use data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This allows me to examine different companies in a uniform manner using new information. For Pioneer Energy Services, its latest trailing-twelve-month earnings is -$98.6M, which, in comparison to the prior year’s level, has become less negative. Since these values may be fairly nearsighted, I’ve created an annualized five-year figure for PES’s net income, which stands at -$53.0M. This means Pioneer Energy Services has historically performed better than recently, while it seems like earnings are now heading back in the right direction again.
We can further examine Pioneer Energy Services’s loss by looking at what has been happening in the industry as well as within the company. Firstly, I want to briefly look into the line items. Revenue growth over the last couple of years has been negative at -9.70%. The key to profitability here is to make sure the company’s cost growth is well-managed. Looking at growth from a sector-level, the US energy services industry has been growing, albeit, at a muted single-digit rate of 3.17% in the previous year, . This is a change from a volatile drop of -13.52% in the previous couple of years. This shows that although Pioneer Energy Services is presently unprofitable, any recent headwind the industry is enduring, the impact on Pioneer Energy Services has been softer relative to its peers.
What does this mean?
Though Pioneer Energy Services’s past data is helpful, it is only one aspect of my investment thesis. With companies that are currently loss-making, it is always difficult to forecast what will occur going forward, and when. The most valuable step is to examine company-specific issues Pioneer Energy Services may be facing and whether management guidance has consistently been met in the past. I recommend you continue to research Pioneer Energy Services to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for PES’s future growth? Take a look at our free research report of analyst consensus for PES’s outlook.
2. Financial Health: Is PES’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 30 September 2017. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.