Wednesday, April 17, 2013

All The Ducks Are Lining Up For Weatherford


As earnings for Q113 start up, one of the most intriguing stocks remains Weatherford International (WFT). The company has infamously failed to accurately remediate federal income taxes for several years now. Even as Weatherford reported record revenues for Q412, earnings failed to match the previous years. The company also incredibly recorded an effective tax rate for the quarter of an amazing 92% to cap off a string of disappointing results.

The company is a multi-national oilfield services firm with a large international presence operating in over 100 countries. For 2012, international revenue accounted for 58% of total revenue. Notably it also focuses more on liquids production in North America.

With domestic natural gas prices surging, all oil services firms will benefit though Halliburton (HAL) and Baker Hughes (BHI) are the most focused on domestic gas. Weatherford is a play on that rebound as domestic pricing will improve, but in addition the stock will benefit from a resolution of the accounting issue on top of the improved pricing. All of the ducks could be lining up for a big rally in 2013 for the oil service sector with Weatherford leading the rebound.

Read the full article at Seeking Alpha.


Disclosure: Long WFT. Please review the disclaimer page for more details. 




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