Wells Fargo Starts RPC Inc. (RES) at Market Perform
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Price: $6.36 +1.27%
Rating Summary:
6 Buy, 18 Hold, 11 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
6 Buy, 18 Hold, 11 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Wells Fargo initiates coverage on RPC Inc. (NYSE: RES) with a Market Perform rating and $12-$14 valuation range.
The analyst comments, "Although we believe U.S pressure pumpers are currently oversold, we judge RES as currently valued at too high a premium to be counted as a favorite among small cap service options. RPC's margins and returns have noticeably improved versus larger OFS companies since the company's 2010 decision to ramp-up investment in the Pressure Pumping (PP) portion of its business, more than doubling its HHP capacity within two years and driving PP services to over 50% of total revenues from under 40% during the 5-year preceding period. Today, we estimate RES is valued at a significant 30-50% premium to CJES and SPN, a premium valuation from which we think it would be difficult for RES to outperform. We estimate RES will earn EBITDA/EPS of $660MM/$1.25 and $598MM/$1.08 in 2012 and 2013, respectively."
For an analyst ratings summary and ratings history on RPC Inc. click here. For more ratings news on RPC Inc. click here.
Shares of RPC Inc. closed at $13.66 yesterday.
The analyst comments, "Although we believe U.S pressure pumpers are currently oversold, we judge RES as currently valued at too high a premium to be counted as a favorite among small cap service options. RPC's margins and returns have noticeably improved versus larger OFS companies since the company's 2010 decision to ramp-up investment in the Pressure Pumping (PP) portion of its business, more than doubling its HHP capacity within two years and driving PP services to over 50% of total revenues from under 40% during the 5-year preceding period. Today, we estimate RES is valued at a significant 30-50% premium to CJES and SPN, a premium valuation from which we think it would be difficult for RES to outperform. We estimate RES will earn EBITDA/EPS of $660MM/$1.25 and $598MM/$1.08 in 2012 and 2013, respectively."
For an analyst ratings summary and ratings history on RPC Inc. click here. For more ratings news on RPC Inc. click here.
Shares of RPC Inc. closed at $13.66 yesterday.
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