Dril-Quip (NYSE:DRQ) was downgraded by Zacks Investment Research from a “hold” rating to a “strong sell” rating in a research report issued to clients and investors on Wednesday.

According to Zacks, “At 2017-end, Dril-Quip reported backlog of $207 million, significantly lower than $318 million and $685 million recorded in 2016 and 2015, respectively. Owing to a drop in bookings, the company’s revenues fell 36.2% in 2016 and 15.4% in 2017. Moreover, Dril-Quip expects some of its subsea bookings and orders to get deferred to 2019. This has made the company project 2018 revenues between $350 million and $370 million, lower than $455.5 million recorded in 2017. Through the first half of 2018, Dril-Quip’s free cashflow declined 14.4% following last year’s 62.2% drop. This has raised concerns about the company’s ability to fund growth projects with internally-generated cashflow.”

Several other brokerages also recently commented on DRQ. B. Riley downgraded shares of Dril-Quip from a “buy” rating to a “neutral” rating and boosted their price objective for the company from $50.00 to $58.00 in a research report on Friday, July 20th. Barclays downgraded shares of Dril-Quip from an “equal weight” rating to an “underweight” rating and set a $41.00 price objective for the company. in a research report on Tuesday, July 31st. Piper Jaffray Companies set a $40.00 price objective on shares of Dril-Quip and gave the company a “hold” rating in a research report on Friday, July 27th. ValuEngine upgraded shares of Dril-Quip from a “hold” rating to a “buy” rating in a research report on Wednesday, July 4th. Finally, Morgan Stanley began coverage on shares of Dril-Quip in a research report on Tuesday. They set an “underweight” rating and a $50.00 price objective for the company. Three analysts have rated the stock with a sell rating, seven have assigned a hold rating and two have given a buy rating to the company’s stock. Dril-Quip has a consensus rating of “Hold” and a consensus target price of $50.22.

DRQ traded down $0.50 during trading on Wednesday, hitting $49.30. 6,212 shares of the stock traded hands, compared to its average volume of 481,771. Dril-Quip has a twelve month low of $37.35 and a twelve month high of $58.95. The company has a market cap of $1.86 billion, a P/E ratio of 189.62 and a beta of 0.96.

Dril-Quip (NYSE:DRQ) last announced its quarterly earnings data on Thursday, July 26th. The oil and gas company reported ($0.24) EPS for the quarter, missing the consensus estimate of ($0.08) by ($0.16). Dril-Quip had a negative net margin of 27.63% and a negative return on equity of 1.19%. The firm had revenue of $94.86 million for the quarter, compared to analyst estimates of $94.76 million. During the same quarter in the prior year, the firm earned $0.09 earnings per share. The firm’s revenue for the quarter was down 25.8% on a year-over-year basis. equities analysts expect that Dril-Quip will post -0.68 earnings per share for the current year.

Dril-Quip announced that its board has authorized a share repurchase program on Thursday, July 26th that authorizes the company to buyback $100.00 million in outstanding shares. This buyback authorization authorizes the oil and gas company to buy up to 4.7% of its shares through open market purchases. Shares buyback programs are typically an indication that the company’s board believes its stock is undervalued.

Several hedge funds and other institutional investors have recently bought and sold shares of the business. BlackRock Inc. grew its stake in shares of Dril-Quip by 4.8% during the second quarter. BlackRock Inc. now owns 4,352,976 shares of the oil and gas company’s stock worth $223,743,000 after buying an additional 200,893 shares during the last quarter. Dimensional Fund Advisors LP grew its stake in shares of Dril-Quip by 0.9% during the first quarter. Dimensional Fund Advisors LP now owns 3,212,351 shares of the oil and gas company’s stock worth $143,913,000 after buying an additional 27,381 shares during the last quarter. Fisher Asset Management LLC grew its stake in shares of Dril-Quip by 46.9% during the second quarter. Fisher Asset Management LLC now owns 1,085,527 shares of the oil and gas company’s stock worth $55,796,000 after buying an additional 346,745 shares during the last quarter. Northern Trust Corp grew its stake in shares of Dril-Quip by 1.8% during the second quarter. Northern Trust Corp now owns 1,052,329 shares of the oil and gas company’s stock worth $54,090,000 after buying an additional 18,456 shares during the last quarter. Finally, Wells Fargo & Company MN grew its stake in shares of Dril-Quip by 10.1% during the first quarter. Wells Fargo & Company MN now owns 871,154 shares of the oil and gas company’s stock worth $39,028,000 after buying an additional 79,730 shares during the last quarter.

About Dril-Quip

Dril-Quip, Inc, together with its subsidiaries, designs, manufactures, sells, and services onshore and offshore drilling and production equipment for use in deepwater, harsh environment, and severe service applications worldwide. It operates through three segments: Western Hemisphere, Eastern Hemisphere, and Asia-Pacific.

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