Shares of Precision Drilling (PDS) are soaring 5.32% in pre-market trading on Wednesday, following a series of positive analyst reports despite mixed quarterly results. The Canadian drilling rig contractor's stock is gaining momentum as investors react to raised price targets and maintained buy ratings from major financial institutions.
CIBC Capital Markets has increased its price target on Precision Drilling from $95 to $100, maintaining an Outperformer rating. CIBC analyst Jamie Kubik noted that the company's adjusted EBITDA came in ahead of expectations, with particularly robust margins in Canada driven by customer-funded rig upgrades. Additionally, Raymond James analyst Michael Barth reaffirmed a Buy rating on the stock with a price target of C$119.00, further bolstering investor confidence.
The positive analyst sentiment comes despite Precision Drilling reporting a 26.67% year-over-year decrease in quarterly earnings, with EPS falling to $0.77 from $1.05, and a 6.37% decline in quarterly sales to $293.753 million. However, investors appear to be focusing on the company's forward-looking statements and increased 2025 capital expenditure guidance to fund 22 Super Series rig upgrades. This move is interpreted as a positive signal for future growth, especially as the company expects activity levels in dry-gas producing basins in the US to increase in the second half of 2025.
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