FET Intrinsic Value Calculation – FORUM ENERGY TECHNOLOGIES Reports Second Quarter Earnings for Fiscal Year 2023
August 8, 2023
☀️Earnings Overview
On June 30, 2023, FORUM ENERGY TECHNOLOGIES ($NYSE:FET) published their financial report for the second quarter of fiscal year 2023. Total revenue for the quarter was USD 185.4 million, a 7.6% increase from the same quarter in the prior year. Net income for the quarter was USD -6.6 million, a 9.3 million decrease from the preceding year.
Share Price
Stock opened at $27.3 and closed at $25.2, a drop of 6.7% from its previous closing price of 27.0. The overall market was slightly bearish, which contributed to the decline in company’s stock price. Despite the drop in stock prices, FORUM ENERGY TECHNOLOGIES reported strong financial results. The increased revenue and income was mainly driven by FORUM ENERGY TECHNOLOGIES’ successful execution of its growth strategy, which included acquisitions of several new companies and expansion into emerging markets. The company also saw strong demand for its oil and gas products and services, which helped drive the overall growth.
Overall, FORUM ENERGY TECHNOLOGIES’ second quarter earnings were strong, despite the drop in stock prices due to the bearish market conditions. The company’s successful execution of its growth strategy and strong demand for its products and services both contributed to the strong financial results. Investors are optimistic that the company will continue to experience positive growth in the future. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for FET. More…
| Total Revenues | Net Income | Net Margin |
| 746.9 | -6.42 | -1.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for FET. More…
| Operations | Investing | Financing |
| 4.01 | 26.88 | -33.59 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for FET. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 843.71 | 424.43 | 41.31 |
Key Ratios Snapshot
Some of the financial key ratios for FET are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 0.5% | 15.5% | 3.6% |
| FCF Margin | ROE | ROA |
| -0.4% | 4.0% | 2.0% |
Analysis – FET Intrinsic Value Calculation
At GoodWhale, we conducted an analysis of the wellbeing of FORUM ENERGY TECHNOLOGIES, one of the world’s leading providers of oilfield products, systems, and services for the drilling, production, refining, and petrochemical industries. Through our proprietary Valuation Line, we have determined the intrinsic value of FORUM ENERGY TECHNOLOGIES’ stock to be around $17.1. Unfortunately, even though we believe it is overvalued, the stock is currently trading at $25.2, which is over 47.3% higher than the estimated intrinsic value. More…
Peers
The competition between Forum Energy Technologies Inc and its competitors, High Arctic Energy Services Inc, Victory Oilfield Tech Inc, and Suzhou Douson Drilling and Production Equipment Co Ltd, is fierce. All of these companies are striving to offer the most reliable and cost-effective solutions to their clients in the oil and gas industry. Each company has its own unique offerings, but they all have the same goal in mind: to provide the best quality products and services to their customers.
– High Arctic Energy Services Inc ($TSX:HWO)
High Arctic Energy Services Inc is a Calgary-based oilfield services company that provides drilling, completion and production services to the energy industry. The company has a market cap of 73.08M as of 2022, which is the total value of all its outstanding shares. High Arctic’s Return on Equity (ROE) of -11.23% indicates that the company has been unable to generate profits from its investments. This suggests that the company may be struggling with profitability and has not been able to generate returns for its shareholders.
– Victory Oilfield Tech Inc ($OTCPK:VYEY)
Victory Oilfield Tech Inc is a leading provider of oilfield technology, services, and products for the energy industry. With a market cap of 5.83M, Victory Oilfield Tech Inc is well positioned to capitalize on the growing demand for oil and gas exploration and production. The company’s strong Return on Equity of 0.92% indicates that it is making efficient use of its assets and capital to increase profitability. Victory Oilfield Tech Inc provides a wide range of services, from wellsite automation and control systems to measurement and well completion systems, to help its customers optimize production, reduce costs, and ensure safety.
– Suzhou Douson Drilling and Production Equipment Co Ltd ($SHSE:603800)
Suzhou Douson Drilling and Production Equipment Co Ltd is a Chinese company that produces and distributes drilling and production equipment for the oil and gas industry. As of 2022, the company has a market cap of 5.64 billion, indicating that it is a well-established company with a large market share. Additionally, the company has a Return on Equity (ROE) of 7.98%, which is higher than the average ROE of 4.7%. This indicates that the company is able to generate a significant amount of profit from its equity investments.
Summary
Investors focused on Forum Energy Technologies’ (FET) second quarter earnings results for fiscal year 2023 reported on June 30, 2023. Total revenue for the quarter was USD 185.4 million, a 7.6% year-on-year increase, whilst net income was reported to be USD -6.6 million, a 9.3 million decrease year-on-year. Stock prices reacted negatively to the news, indicating that investors felt the earnings figures were below expectations. As a result, investors may need to review and assess FET’s future prospects in order to determine whether the stock deserves attention as a potential investment opportunity.
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