Arun Jayaram, an analyst from J.P. Morgan, maintained the Hold rating on NOV. The associated price target remains the same with $15.00.
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Arun Jayaram has given his Hold rating due to a combination of factors impacting NOV’s current and future performance. The company is facing macroeconomic challenges, including global trade uncertainties and a strong supply response from OPEC+, which are affecting both its upstream and industrial customer bases. These factors are leading to a less favorable sales mix, as higher-margin product and spare part sales are being overshadowed by lower-margin capital equipment sales.
Additionally, NOV is dealing with increased tariff costs, which it is attempting to mitigate through various cost-reduction strategies, including facility consolidation and supply chain restructuring. Despite these efforts, the company’s EBITDA estimates have been revised downward, reflecting anticipated declines in revenue and profitability in certain segments. While NOV’s free cash flow profile is expected to improve, ongoing macroeconomic headwinds and delays in offshore drilling activity contribute to the Hold rating, as the stock’s performance is likely to align with broader industry trends until clearer market conditions emerge.
Jayaram covers the Energy sector, focusing on stocks such as Exxon Mobil, Diamondback, and APA. According to TipRanks, Jayaram has an average return of 8.2% and a 53.07% success rate on recommended stocks.