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What Did the Market Suggest about Weatherford on September 29?

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What Did the Market Suggest about Weatherford on September 29? PART 1 OF 3

Weatherford’s Stock Movement in the Week Ended September 29

Weatherford stock compared with the industry and crude oil

Weatherford International (WFT) stock rose 8% in the week ended September 29, 2017. In comparison, the VanEck Vectors Oil Services ETF (OIH) generated a 3% return during the week. So, WFT has outperformed OIH in the past week.

On September 29, the West Texas Intermediate (or WTI) crude oil price was up 2% compared to the WTI crude oil price on September 22. You can read more about the energy market in Market Realist’s Mid-Week Energy Sector Update: Crude Oil Takes the Lead.

Weatherford’s Stock Movement in the Week Ended September 29

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Despite a relatively steady crude oil price, oilfield services companies Oceaneering International (OII) and Halliburton (HAL) have seen their stock prices decline in 2017. You can read about HAL in Will the International Slowdown Hurt Halliburton in 2017?

The US rig count has increased 1% in the past week until September 29, 2017. Since September 29, 2016, the US rig count has increased 80%, led primarily by steady crude oil price movement.

The Energy Select Sector SPDR ETF (XLE) has generated 2% returns since September 22, 2017. The SPDR S&P 500 ETF (SPY), which generated 1% returns, also underperformed Weatherford during the same period. The Dow Jones Industrial Average (DJIA-INDEX) did not change during the week ended September 29, 2017.

What can affect WFT’s returns in 3Q17?

  • WFT’s North America segment could grow, led by Canada’s recovery from the spring breakup and new contract commencement in the US.
  • WFT’s could see a revenue increase in 3Q17 from its Europe, Caspian, Russia, and Sub-Saharan Africa regions due to higher activity levels in the North Sea.
  • WFT’s operating margins in the Middle East, North Africa, and Asia-Pacific regions can remain flat in 3Q17 due to higher project startup costs and an unfavorable change in geographic mix.

You can read more about WFT in What’s Keeping Weatherford Down despite Margin Improvement? and Weatherford International: Valuation, Analyst Targets, and More.

Next, we’ll discuss what WFT’s implied volatility means for its stock price.

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