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What Might Happen to Oil States’ Revenues in Q2 2018?

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Dec. 4 2020, Updated 10:53 a.m. ET

Oil States International’s revenue trend

Oil States International (OIS) ranks fourth on our list of the top five revenue growing OFS (oilfield equipment and services) companies, according to Wall Street analysts. In the first quarter, its revenues increased 67% YoY (year-over-year). From Q4 2017 to Q1 2018, its revenues increased 38%.

GEODynamics, which OIS acquired in January, contributed $45.8 million of revenue in the first quarter. Higher customer-driven activity in the Well Site Services and Offshore or Manufactured Products segments, as well as contributions from OIS’s Falcon operations, resulted in higher first-quarter revenues. More US shale play activity led to higher demand for OIS’s short-cycle product and service offerings in the first quarter.

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OIS’s revenues versus estimates

For the second quarter, Wall Street analysts expect to see 14% revenue growth sequentially for OIS. YoY, OIS’s revenues could increase 69% in the second quarter. From Q2 2016 to Q1 2018, its actual revenues beat analysts’ average estimate by 2%.

What could affect OIS’s revenues in Q2 2018?

Oil States International’s management expects higher Well Site Services segment revenues in 2018. Upstream activity supporting US well completions is steadily improving. As a result, demand for consumable completion products along with higher end equipment and services is strengthening. Along with higher contributions from OIS’s recent acquisitions, including GEODynamics, all these factors could result in higher second-quarter revenues.

Revenue growth for OIS’s peers

For the second quarter, analysts expect OIS’s peer Oceaneering International (OII) to grow its revenues 7.1% sequentially. They expect Superior Energy Services (SPN) to see an 11.3% revenue increase in the quarter, and McDermott International (MDR) to grow 36%. MDR is expected to see the strongest revenue growth in the industry. We looked at MDR in Part 2 of this series.

Next, we’ll look at Helix Energy Solutions Group’s (HLX) past revenue trend and why sell-side analysts expect to see its revenue grow in the second quarter.

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