Despite its high-quality rigs, Helmerich & Payne's returns will be limited by land rig overcapacity.
We are lowering our fair value estimates for land drillers by 5% to 15%, with Helmerich & Payne moving to $41 from $43, Precision to $3 from $3.25, Patterson to $13.50 from $14, and Nabors to $6.50 from $7.50. Our no-moat rating for all of the names remains in place.The lower fair values come partly from a more pessimistic near-term outlook for the companies’ results, as we think U.S. land rig counts for the companies are likely to peak in mid-2018 along with the overall U.S. horizontal ri...
Helmerich & Payne provides drilling services and technologies for oil and gas exploration and production companies. The company's contract drilling business segments are: United States Land, which operates in Colorado, Louisiana, Ohio, Oklahoma, Montana, New Mexico, North Dakota, Pennsylvania, Texas, Utah, West Virginia and Wyoming; Offshore, which operates in United States federal waters in the Gulf of Mexico; and International Land, which has rigs in Argentina, Bahrain, Colombia and United Arab Emirates. The company's drilling technology-based business segment, Helmerich & Payne Technologies, is focused on developing, promoting and commercializing technologies designed to improve the drilling operations.
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Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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