Evecore ISI Recommends Buying Pressure Pumpers Following Latest Checks (CJES) (PTEN)

Evecore ISI analyst James West had a interesting note on pressure pumpers, which could be contributing to upside seen in the names today.

West notes colleague Steve Richardson was in Houston the last two days making the rounds with his E&P universe. "A key data point that emerged is that frac spreads are hard, if not impossible to hire without substantial price increases," he said. "One of the largest North American E&P company executives indicated to his group that the equipment is there but there are no crews and service companies want a much higher price to re-activate than existing contracts."

"This proves our view that attrition is under-estimated, that fracking companies will see the benefits of the upturn first, and that all pressure pumpers are a buy," West said.

The firm's favorite is C&J Energy Services (NYSE: CJES), followed by CFW. They also like Patterson-UTI Energy (NASDAQ: PTEN).

"The bottom is in, the upturn lingers, and the competitive environment is much improved," he said. "It's time to increase or add exposure."

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