Cactus (WHD) AI Stock Analysis

• Market Cap: $3.32B
• Dividend Yield: 1.32%
• Average Volume (3M): 654.40K
• Price to Earnings (P/E): 15.6
• Beta (1Y): 1.04
• Revenue Growth: -0.71%
• EPS Growth: -7.89%
• Country: US
• Employees: 1,600
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 0.66
• Shares Outstanding: 68,574,875
• 10 Day Avg. Volume: 736,472
• 30 Day Avg. Volume: 654,404
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.86
• Enterprise Value/Revenue: 2.55
• Enterprise Value/Gross Profit: 5.42
• Enterprise Value/Ebitda: 8.22
• 1Y Price Target: $50.00
• Price Target Upside: 24.50% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 75 Outperform
• Price Target: $47.00 ▲(17.03% Upside)

Cactus's strong financial performance and strategic growth initiatives are significant strengths, contributing positively to the overall score. However, technical indicators suggest a neutral trend, and challenges in specific segments and increased costs slightly offset the positive outlook.

Positive Factors

Cash Flow Management

Strong cash flow management enhances financial flexibility, allowing Cactus to invest in growth opportunities and weather market fluctuations effectively.

Strategic Acquisition

This acquisition strengthens Cactus's market position by expanding its product offerings and diversifying revenue streams, which can drive long-term growth.

Dividend Increase

Increasing dividends signals management's confidence in sustained cash flow, enhancing shareholder value and attracting long-term investors.

Negative Factors

Pressure Control Segment Decline

Declining performance in the Pressure Control segment could indicate challenges in maintaining competitive advantage and profitability in a key business area.

Impact of Increased Tariffs

Higher tariffs increase input costs, potentially squeezing margins and affecting the company's ability to maintain competitive pricing and profitability.

Overall Revenue Decline

A decline in overall revenue suggests potential challenges in market demand or competitive positioning, which could impact long-term growth prospects.

Cactus Business Overview & Revenue Model

Company Description

Cactus, Inc. designs, manufactures, sells, and rents a range of wellheads and pressure control equipment in the United States, Australia, China, and the Kingdom of Saudi Arabia. The company's principal products include Cactus SafeDrill wellhead systems, Cactus SafeLink monobore, SafeClamp, and SafeInject systems, as well as frac stacks, zipper manifolds, and production trees. It also provides field services, such as 24-hour service crews to assist with the installation, maintenance, repair, and safe handling of the wellhead and pressure control equipment; and repair and refurbishment services. The company sells or rents its products for onshore unconventional oil and gas wells for drilling, completion, and production phases of the wells. In addition, it operates 15 service centers in the United States, as well as 3 service centers in Eastern Australia. Cactus, Inc. was founded in 2011 and is headquartered in Houston, Texas.

How the Company Makes Money

Cactus generates revenue primarily through the sale and rental of its wellhead and pressure control equipment to oil and gas operators. The company has a diverse revenue model that includes both direct sales and service contracts, which encompass installation, maintenance, and repair of its products. Key revenue streams include the initial sale of equipment, recurring revenues from service agreements, and rental income from equipment leased to clients. Cactus also benefits from strategic partnerships with major oil and gas companies, which enhance its market reach and provide a steady stream of orders. Additionally, the company’s focus on innovation and high-quality products allows it to command premium pricing in a competitive market.

Cactus Financial Statement Overview

Summary

Cactus demonstrates strong financial performance with consistent revenue growth and improving profit margins. The company maintains a healthy balance sheet with a low debt-to-equity ratio and strong cash flow management, indicating resilience and operational efficiency.

Income Statement

Cactus demonstrates strong financial performance with consistent revenue growth and improving profit margins. The gross profit margin in TTM is 19.4%, supported by a net profit margin of 16.2%. While there was a slight decline in total revenue from 2024 to TTM, the EBIT and EBITDA margins remain robust at 26.4% and 31.1% respectively, indicating efficient operations.

Balance Sheet

The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.03 in TTM, indicating low leverage and financial stability. The equity ratio of 73.9% underscores substantial equity financing. Furthermore, the ROE stands at 13.4%, reflecting efficient use of shareholders' equity to generate profit.

Cash Flow

Cactus exhibits strong cash flow management with a free cash flow to net income ratio of 1.35 in TTM, highlighting robust cash generation capability. The operating cash flow to net income ratio of 1.52 further supports solid operational cash flow. Despite a decrease in free cash flow compared to the previous year, the overall cash flow indicators remain positive.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.12B	1.13B	1.10B	688.37M	438.59M	348.57M
Gross Profit	526.12M	436.39M	406.29M	242.45M	121.45M	111.62M
EBITDA	346.78M	363.54M	337.66M	211.57M	111.73M	111.66M
Net Income	181.17M	185.41M	169.17M	110.17M	49.59M	34.45M
Balance Sheet
Total Assets	1.82B	1.74B	1.52B	1.12B	982.08M	815.59M
Cash, Cash Equivalents and Short-Term Investments	405.18M	342.84M	133.79M	344.53M	301.67M	288.66M
Total Debt	42.02M	41.72M	39.97M	35.52M	33.21M	28.13M
Total Liabilities	475.99M	475.15M	457.79M	408.45M	387.05M	264.82M
Stockholders Equity	1.35B	1.07B	865.52M	571.92M	468.64M	352.97M
Cash Flow
Free Cash Flow	244.24M	276.94M	296.30M	89.59M	49.82M	118.89M
Operating Cash Flow	276.27M	316.11M	340.28M	117.88M	63.76M	143.38M
Investing Cash Flow	-47.84M	-35.39M	-654.79M	-25.54M	-11.63M	-18.15M
Financing Cash Flow	-69.50M	-70.14M	103.28M	-47.38M	-39.39M	-40.21M

Cactus Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 40.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WHD, the sentiment is Negative. The current price of 40.16 is below the 20-day moving average (MA) of 40.88, below the 50-day MA of 41.34, and below the 200-day MA of 47.03, indicating a bearish trend. The MACD of -0.23 indicates Negative momentum. The RSI at 46.98 is Neutral, neither overbought nor oversold. The STOCH value of 63.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WHD.

Cactus Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OII	79 Outperform	$2.57B	12.94	23.84%	―	8.14%	62.72%
WHD	75 Outperform	$3.32B	15.64	17.23%	1.32%	-0.71%	-7.89%
WFRD	74 Outperform	$5.00B	10.70	39.38%	1.44%	-5.35%	-4.15%
VAL	72 Outperform	$3.59B	13.12	11.83%	―	18.78%	-72.57%
NOV	70 Outperform	$5.01B	11.07	7.18%	3.78%	-1.21%	-54.44%
MRC	61 Neutral	$1.24B	-61.22	-0.56%	―	-9.81%	-124.43%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%

Cactus Corporate Events

Cactus Announces Acquisition of Baker Hughes Unit

Cactus, Inc. announced its participation in upcoming investor meetings, where it will present materials related to its operations and financial performance. The company recently completed a significant merger with FlexSteel Holdings, enhancing its market position and operational capabilities. Additionally, Cactus plans to acquire Baker Hughes Company’s surface pressure control business, which is expected to further strengthen its industry positioning. These strategic moves are likely to impact Cactus’s operations and stakeholder interests positively.