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Analyzing Basic Energy Services’ Future Drivers

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Does Basic Energy Services expect a higher margin in 2017?

Basic Energy Services’ (BAS) management expects increased rig utilization and better pricing to result in a higher operating margin in 1Q17. It also expects its fixed costs to remain in check in 2017.

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Basic Energy Services’ future drivers

In the pressure pumping business, BAS’s management believes that the current rise in the US rig count has been making up for the fall in the US hydraulic fracturing fleet since 2014.

Patterson commented in the company’s 1Q17 press conference, “Our frac calendars in our large coiled tubing spreads are sold out through the end of Q3 and will soon be booked through the remainder of the year. We are currently booking dates into 2018.”

BAS makes up 0.01% of the iShares Micro-Cap ETF (IWC). The energy sector makes up 3.4% of IWC.

Next, we’ll discuss Basic Energy Services’ revenue.

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