Cactus (43C) AI Stock Analysis

Company Guidance

For Q4, Pressure Control revenue is expected to be flat to up from Q3, domestic U.S. land rig counts are expected to remain steady from today's level through the end of the year, and adjusted EBITDA margins are expected to be in the 23%-25% range, excluding approximately $4 million of stock-based comp expense; Cactus International sales are expected to remain in line with Q3 levels. For next year, Pressure Control revenue levels are expected to be broadly flat with 2026, with the back half of 2027 being stronger than the first half, while cost savings are expected in the back half of 2027 and to more fully benefit 2028 results, and sales diversification is expected to benefit revenues in 2028. Total tariffs on most goods imported from China remain approximately 75%. Spoolable Technologies revenue is expected to be up low single digits from Q3, adjusted EBITDA margins are expected to be approximately 39%-41%, excluding $1 million of stock-based compensation expense, and adjusted corporate EBITDA is expected to be a charge of approximately $6 million, excluding $2 million of stock-based comp; non-U.S. sales are expected to represent approximately 20% of sales for 2026, more than doubling from sub 10% in 2025. Q4 effective tax rate is expected to be 24%, estimated tax rate for adjusted EPS approximately 27%, depreciation and amortization approximately $27 million, and the payment and related distributions under the tax receivable agreement approximately $25 million; full year 2026 net CapEx is expected to be approximately $65 million, and the quarterly dividend is $0.15 per share. The Middle East Spoolable Technologies facility is expected to require approximately $100 million, with the majority of the capital investment split between 2027 and 2028, a modest amount incurred in 2026, and operations commencing in 2029.