Strength Seen in Patterson-UTI (PTEN): Can Its 12.1% Jump Turn into More Strength?
Patterson-UTI (PTEN) shares soared 12.1% in the last trading session to close at $12.48. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 5% gain over the past four weeks.
Patterson-UTI Energy stock ended sharply higher yesterday after announcing a deal to combine with NexTier Oilfield Solutions. The $5.4 billion, all-stock merger is set to create one of the nation’s biggest providers of drilling and fracking services targeting shale plays. Should the merger be completed by the end of this year, the combined entity will have a significant presence in the Permian Basin.
This provider of onshore contract drilling services is expected to post quarterly earnings of $0.45 per share in its upcoming report, which represents a year-over-year change of +800%. Revenues are expected to be $782.19 million, up 25.7% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Patterson-UTI, the consensus EPS estimate for the quarter has been revised marginally higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on PTEN going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Patterson-UTI belongs to the Zacks Oil and Gas - Drilling industry. Another stock from the same industry, Helmerich & Payne (HP), closed the last trading session 3.5% higher at $35.25. Over the past month, HP has returned 7.3%.
Helmerich & Payne's consensus EPS estimate for the upcoming report has changed +1% over the past month to $0.92. Compared to the company's year-ago EPS, this represents a change of +240.7%. Helmerich & Payne currently boasts a Zacks Rank of #3 (Hold).
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