It has been about a month since the last earnings report for RPC (RES). Shares have lost about 3.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is RPC due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
RPC’s Earnings and Revenues Outpace Estimates in Q3
RPC Inc reported adjusted earnings of 32 cents per share in the third quarter, beating the Zacks Consensus Estimate of 25 cents. The bottom line compares favorably with the year-ago quarter’s profit of 2 cents per share.
Total quarterly revenues of $460 million beat the Zacks Consensus Estimate of $378 million. The top line significantly improved from the year-ago figure of $225 million.
The strong quarterly results were backed by higher activity levels in all the service lines and improved pricing.
Operating profit in the Technical Services segment totaled $89.5 million, higher than year-ago quarter’s profit of $8.3 million. The upside was caused by increased customer activities along with higher pricing.
Operating profit in the Support Services segment was $5.3 million, reversing from a year-ago loss of $55 thousand. The improvement was owing to a hike in pricing within rental tools along with increased activities.
Total operating profit in the quarter was $92.2 million, skyrocketing from $7.9 million. The average domestic rig count was 761, reflecting a 52.2% increase from the year-ago level. The average oil price in the quarter was $92.84 per barrel. The same for natural gas was $8.03 per thousand cubic feet.
Cost and Expenses
In third-quarter 2022, the cost of revenues increased from $170.6 million to $309.8 million. Selling, general and administrative expenses increased to $38.2 million from the year-ago figure of $31.5 million.
As of Sep 30, RPC had cash and cash equivalents of $35.9 million.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
The consensus estimate has shifted 42.86% due to these changes.
Currently, RPC has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
RPC has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
RPC is part of the Zacks Oil and Gas - Field Services industry. Over the past month, Halliburton (HAL), a stock from the same industry, has gained 0.8%. The company reported its results for the quarter ended September 2022 more than a month ago.
Halliburton reported revenues of $5.36 billion in the last reported quarter, representing a year-over-year change of +38.8%. EPS of $0.60 for the same period compares with $0.28 a year ago.
Halliburton is expected to post earnings of $0.66 per share for the current quarter, representing a year-over-year change of +83.3%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.9%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Halliburton. Also, the stock has a VGM Score of B.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report