** Citigroup says besides tariffs, the key question for oilfield service cos this earnings season has been the outlook for industry fundamentals in light of deflating crude prices
** "Public E&Ps have largely shifted their investment strategies toward maintenance plus growth fueled by efficiency gains in an effort to maximize free cash flow" - brokerage
** Adds that if current conditions hold, about 75 oil rigs are expected to cease operation or nearly 15% of domestic oil drilling
** Expects gas activity to pick up in 2H25 to moderate the decline but some may not be deployed until late in the year
** Brokerage sees risk of margin compression from reduced operating leverage and modestly lower prices
Brokerage cuts price target on the following companies:
Company | New PT | Old PT | Upside to stock's last close |
Halliburton HAL.N | $29 | $31 | 40.8% |
SLB SLB.N | $47 | $48 | 35.3% |
ProPetro Holding PUMP.N | $6.50 | $10 | 18% |
Patterson-UTI Energy PTEN.O | $8 | $10 | 32.7% |
ChampionX CHX.O | $35 | $40 | 38.7% |
Cactus Inc WHD.N | $45 | $50 | 9.8% |
(Reporting by Pooja Menon in Bengaluru)
((Pooja.Menon@thomsonreuters.com;))
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