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Patterson-UTI Energy: Management’s Estimates for 2Q16

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What does management think?

Patterson-UTI Energy’s (PTEN) chairman, Mark S. Siegel, expressed confidence about the possibility of an energy market recovery. In the company’s 2Q16 press release, he said, “During the second quarter, activity stabilized in both our drilling and pressure pumping businesses as commodity prices improved. We are encouraged by the recent increase in our rig count and optimistic about a continued recovery in the U.S. rig count, assuming commodity prices remain at or above recent levels.” Patterson-UTI Energy accounts for 0.24% of the iShares S&P Mid-Cap ETF (IJH).

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Management’s views for 3Q16

  • Patterson-UTI Energy’s operated average US rig count is expected to rise 9% to 60—compared to 2Q16. Its average revenue per operating day is expected to be steady, which will benefit its rigs contract business.
  • Management expects the revenue and margin to be flat in the pressure pumping business in 3Q16—compared to 2Q16.
  • The pricing in the pressure pumping business remains under stress.

Read Can Patterson-UTI Energy’s Positives Weather the Energy Storm? to learn more. Next, we’ll discuss investors’ short interest in Patterson-UTI Energy and its implications.

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