Wednesday, July 23, 2014

Expanding Margins Will Lead Weatherford International Higher


Recently, Weatherford International (NYSE: WFT  ) sold drilling assets in Russia and Venezuela to further transition away from unprofitable businesses that never achieved the expected margins. Investors can quickly compare the numbers to the solid international margins of Schlumberger Limited (NYSE: SLB  ) and Halliburton (NYSE: HAL  ) to quickly grasp how far off course Weatherford had steered in the process of expanding internationally.

The oilfield services laggard has turned to improving operations after a few years of working out accounting and tax issues. Weatherford has taken several previous steps to improve operations with the hopes of growing margins. Even after the recent gains in the stock, Weatherford continues to trade at low revenue multiples, showing how much of an impact the low-margin drag has had on the stock.

Read the full article here.


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




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