BUZZ-Citigroup lowers PT on US-based oilfield service companies

Reuters05-05
BUZZ-Citigroup lowers PT on US-based oilfield service companies

** 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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