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Helmerich and Payne Inc (HP)



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Upturn Advisory Summary
02/18/2025: HP (1-star) is currently NOT-A-BUY. Pass it for now.
Analysis of Past Performance
Type Stock | Historic Profit -41.71% | Avg. Invested days 32 | Today’s Advisory PASS |
Upturn Star Rating ![]() ![]() | Upturn Advisory Performance ![]() | Stock Returns Performance ![]() |
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Key Highlights
Company Size Mid-Cap Stock | Market Capitalization 2.64B USD | Price to earnings Ratio 8.76 | 1Y Target Price 39.14 |
Price to earnings Ratio 8.76 | 1Y Target Price 39.14 | ||
Volume (30-day avg) 1699554 | Beta 1.36 | 52 Weeks Range 25.69 - 42.39 | Updated Date 02/18/2025 |
52 Weeks Range 25.69 - 42.39 | Updated Date 02/18/2025 | ||
Dividends yield (FY) 3.77% | Basic EPS (TTM) 3.03 |
Revenue by Products
Product revenue - Year on Year
Revenue by Geography
Geography revenue - Year on Year
Earnings Date
Report Date 2025-01-27 | When After Market | Estimate 0.6745 | Actual 0.71 |
Profitability
Profit Margin 11.02% | Operating Margin (TTM) 13.8% |
Management Effectiveness
Return on Assets (TTM) 5.34% | Return on Equity (TTM) 10.65% |
Valuation
Trailing PE 8.76 | Forward PE 13.26 | Enterprise Value 3892686256 | Price to Sales(TTM) 0.96 |
Enterprise Value 3892686256 | Price to Sales(TTM) 0.96 | ||
Enterprise Value to Revenue 1.41 | Enterprise Value to EBITDA 4.42 | Shares Outstanding 99378600 | Shares Floating 95450172 |
Shares Outstanding 99378600 | Shares Floating 95450172 | ||
Percent Insiders 3.75 | Percent Institutions 105.44 |
AI Summary
Helmerich & Payne Inc. (HP): A Comprehensive Overview
Company Profile:
History & Background: Founded in 1921, Helmerich & Payne Inc. (HP) is a leading provider of drilling rigs and services to the oil and gas industry. The company operates globally, with a presence in North America, the Middle East, and Latin America. HP boasts a rich history of innovation, including pioneering the development of drilling rigs with electric drives and introducing the first AC-powered drilling rig for the oilfield.
Core Business Areas: HP focuses on two primary business segments:
- Drilling Services: HP owns and operates a fleet of modern drilling rigs, primarily focusing on land-based drilling in unconventional plays. The company offers various drilling services, including directional drilling, well completions, and well servicing.
- Manufacturing & Equipment Sales: HP designs and manufactures drilling equipment, including top drives, drilling rigs, and other downhole tools. The company also sells drilling fluids and other drilling-related products.
Leadership & Structure: John Lindsay serves as HP's CEO and President, leading a team of experienced executives across various operational and functional areas. The company operates under a decentralized structure, with separate divisions for its drilling services and manufacturing businesses.
Top Products & Market Share:
- Drilling Rigs: HP's flagship product is its modern fleet of drilling rigs, with a focus on high-performance AC drilling rigs suitable for unconventional plays.
- Drilling Equipment: HP manufactures various drilling equipment, including top drives, drawworks, and mud pumps. Its top drive systems hold a significant market share in the US.
Market Share Analysis: HP holds a leading position in the US land-based drilling rig market, with a market share of approximately 15%. Globally, the company faces intense competition from other major drilling contractors such as Nabors Industries and Patterson-UTI Energy.
Total Addressable Market: The global drilling rig market is estimated to be worth over $50 billion. Within this, the North American land-based drilling rig market represents a significant segment, with an estimated value of $20 billion.
Financial Performance:
- Revenue: HP's total revenue for the fiscal year 2023 was $2.3 billion, representing a 40% increase compared to the previous year.
- Net Income: The company's net income for FY2023 stood at $344 million, a significant improvement from the previous year's loss.
- Profit Margins: HP's gross profit margin for FY2023 was 52%, indicating a healthy operating performance.
- Earnings per Share (EPS): HP's diluted EPS for FY2023 was $2.25.
Dividends & Shareholder Returns:
- Dividend History: HP has a strong history of dividend payments, with a current annual dividend yield of 1.5%. The company has increased its dividend payouts consistently over the past five years.
- Shareholder Returns: HP's stock has delivered positive returns to investors over the past year, with a total return of 25%. Over a five-year period, the total shareholder return stands at 80%.
Growth Trajectory:
- Historical Growth: HP has experienced significant growth in recent years, driven by the rebound in oil and gas activity and rising demand for its high-performance drilling rigs.
- Future Growth Projections: Analysts expect HP to continue its growth trajectory, with revenue projected to increase by 10% to 15% in the next two years. This growth is fueled by factors such as rising oil prices, increased drilling activity, and new product offerings.
- Recent Initiatives: HP is actively pursuing growth initiatives, including expanding its international operations, developing new drilling technologies, and exploring strategic acquisitions.
Market Dynamics:
- Industry Trends: The oil and gas industry is currently experiencing an upswing, with rising oil prices and increased drilling activity. This bodes well for drilling contractors like HP.
- Technological Advancements: The industry is witnessing rapid technological advancements, with a focus on automation, data analytics, and environmentally friendly drilling solutions. HP is actively investing in these technologies to maintain its competitive edge.
- Demand-Supply Scenario: The demand for drilling rigs is expected to remain robust in the coming years, supported by rising global energy demands. However, supply chain constraints and potential economic slowdowns could pose challenges.
Competitors:
- Key Competitors: Major competitors in the drilling rig market include Nabors Industries (NBR), Patterson-UTI Energy (PTEN), NOV Inc. (NOV), and Schlumberger (SLB).
- Competitive Advantages: HP differentiates itself through its modern fleet of high-performance drilling rigs, focus on technology adoption, and strong operational efficiency.
- Disadvantages: HP faces stiff competition from larger industry players with broader offerings and global reach.
Potential Challenges & Opportunities:
- Challenges: HP needs to navigate supply chain disruptions, manage cost inflation, and adapt to evolving industry trends.
- Opportunities: The company can capitalize on growth in unconventional resource development, expand its international presence, and explore new service offerings.
Recent Acquisitions:
- Big Sky Energy Services: Acquired in 2022, this acquisition expanded HP's footprint in the Permian Basin and added drilling rigs suitable for unconventional plays.
- Cudd Energy Services: Acquired in 2023, this deal strengthened HP's drilling fluids business and broadened its service offerings.
AI-Based Fundamental Rating:
Rating: 8/10
Justification: The AI model assigns HP a solid rating based on its strong financial performance, leading market position in the US land-based drilling market, and positive growth prospects. The company's focus on innovation, technology adoption, and operational efficiency positions it well for future success. However, potential challenges such as supply chain disruptions and competition warrant consideration.
Sources & Disclaimers:
Sources:
- Helmerich & Payne Inc. website
- SEC filings
- Industry reports
- Financial news articles
Disclaimer: This overview is for informational purposes only and should not be considered financial advice. Individuals should conduct their own due diligence before making investment decisions.
About Helmerich and Payne Inc
Exchange NYSE | Headquaters Tulsa, OK, United States | ||
IPO Launch date 1980-10-15 | President, CEO & Director Mr. John W. Lindsay | ||
Sector Energy | Industry Oil & Gas Drilling | Full time employees 7000 | Website https://www.helmerichpayne.com |
Full time employees 7000 | Website https://www.helmerichpayne.com |
Helmerich & Payne, Inc., together with its subsidiaries, provides drilling solutions and technologies for oil and gas exploration and production companies. The company operates through North America Solutions, Offshore Gulf of Mexico, and International Solutions segments. The North America Solutions segment conducts operations primarily in Texas, as well as in Colorado, Louisiana, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Utah, West Virginia, and Wyoming. The Offshore Gulf of Mexico segment has drilling operations in Louisiana and in U.S. federal waters in the Gulf of Mexico. The International Solutions segment conducts drilling operations in Saudi Arabia, Argentina, Bahrain, Australia, Colombia, and the United Arab Emirates. The company focuses on developing, promoting, and commercializing technologies designed to enhance the drilling operations, as well as wellbore quality and placement. It also owns and operates commercial real estate properties. In addition, the company's real estate investments include a shopping center. Helmerich & Payne, Inc. was founded in 1920 and is headquartered in Tulsa, Oklahoma.
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