Flotek Industries’ revenue trend
In 4Q17, Flotek Industries’ (FTK) revenues increased 2.7% compared to 4Q16. From 3Q17 to 4Q17, the company’s revenues decreased ~9%.
Increased sales of higher margin products led to the rise in Flotek Industries’ revenue growth in 4Q17—compared to 4Q16. However, the weather’s negative impact and upstream customers’ budget exhaustion partially offset the impact of the positive factors.
Revenues versus estimates
In 1Q18, Wall Street analysts expect to see 1.2% revenue growth for Flotek Industries—compared to 4Q17. From 1Q16 to 4Q17, Flotek Industries’ reported revenues fell short of analysts’ estimates by 1.4%.
What could impact Flotek Industries’ revenues?
Flotek Industries’ management expects that higher demand for its prescriptive chemistry management platform could fuel the revenue growth in 1Q18. The company’s new inventory strategy is expected to improve its delivery capability, which could accelerate the market penetration for its chemistry offerings. Overall, the growth in hydraulic fracturing and more proppant usage could lead to a higher usage of Flotek Industry’s chemistry products in 2018.
Flotek Industries accounts for 0.09% of the iShares S&P Small-Cap 600 Value ETF (IJS). IJS tracks an index composed of small-capitalization US equities that exhibit value characteristics. The energy sector accounts for 0.85% of IJS. IJS has decreased 2% year-to-date—compared to a 31% increase in Flotek’s stock price during the same period.