Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Oil & Gas - Related Services and Equipment industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Oil & Gas - Related Services and Equipment Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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6 Undervalued Oil & Gas - Related Services and Equipment Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Oil & Gas - Related Services and Equipment industry for Wednesday, February 28, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Oil & Gas - Related Services and Equipment industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Gulf Island Fabrication, Inc.’s Value Grade

Value Grade:

Gulf Island Fabrication, Inc. is a fabricator of complex steel structures and modules. The Company is a provider of specialty services, including project management, hookup, commissioning, repair, maintenance, scaffolding, coatings, welding enclosures, civil construction, and staffing services to the industrial and energy sectors. Its segments include the Services Division, Fabrication Division, and Shipyard Division. The Services Division provides maintenance, repair, construction, scaffolding, coatings, welding enclosures and other specialty services on offshore platforms and inland structures and at industrial facilities. The Fabrication Division fabricates modules, skids and piping systems for onshore refining, petrochemical, and offshore facilities and fabricates foundations, secondary steel components and support structures for alternative energy developments and coastal mooring facilities. The Shipyard Division includes two ferries under construction.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Gulf Island Fabrication, Inc. has a Value Score of 67, which is considered to be undervalued.

When you look at Gulf Island Fabrication, Inc.’s price-to-sales ratio at 0.53 compared to the industry median at 0.77, this company has a lower price relative to revenue compared to its peers. This could make Gulf Island Fabrication, Inc.’s stock more attractive for value investors.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Gulf Island Fabrication, Inc.’s shareholder yield is lower than its industry median ratio of (1.03%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Gulf Island Fabrication, Inc.’s price-to-book ratio is lower than its industry median ratio of 1.28. This could make Gulf Island Fabrication, Inc. more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Gulf Island Fabrication, Inc.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Gulf Island Fabrication, Inc.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 14.92. This could make Gulf Island Fabrication, Inc. more attractive because the lower P/FCF ratio indicates that Gulf Island Fabrication, Inc. is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Koil Energy Solutions Inc’s Value Grade

Value Grade:

Koil Energy Solutions, Inc. is an energy services company, which provides equipment and support services to the energy and offshore industries. The Company?s core services and technological solutions include distribution system installation support and engineering services, umbilical terminations, loose-tube steel flying leads and related services. In addition, it supports subsea engineering, manufacturing, installation, commissioning and maintenance projects located anywhere in the world. The Company?s line of solutions is engineered and manufactured primarily for integrated, large independent, and foreign national energy companies in offshore areas throughout the world. These products are often developed in direct response to customer requests for solutions to critical needs in the field. The Company primarily serves the offshore oil and gas market. It also serves additional markets, including offshore wind, offshore wave energy, hydrogen and liquefied natural gas.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Koil Energy Solutions Inc has a Value Score of 88, which is considered to be undervalued.

Koil Energy Solutions Inc’s price-to-book ratio is higher than its peers. This could make Koil Energy Solutions Inc less attractive for value investors when compared to the industry median at 1.28.

You can read more about Koil Energy Solutions Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

KLX Energy Services Holdings Inc’s Value Grade

Value Grade:

KLX Energy Services Holdings, Inc. is a provider of oilfield services to onshore oil and natural gas exploration and production companies operating in both conventional and unconventional areas throughout the United States. It operates in three segments on a geographic basis, including the Southwest Region (the Permian Basin, Eagle Ford Shale and the Gulf Coast as well as in industrial and petrochemical facilities), the Rocky Mountains Region (the Bakken, Williston, DJ, Uinta, Powder River, Piceance and Niobrara basins) and the Northeast/Mid-Con Region (the Marcellus and Utica Shale as well as the Mid-Continent STACK and SCOOP and Haynesville Shale). Its primary services include directional drilling, coiled tubing, thru tubing, hydraulic frac rentals, fishing, pressure control, wireline, fluid pumping, flowback, testing, pressure pumping and well control services. Its primary rentals and products include hydraulic fracturing stacks, blow out preventers, tubulars, and downhole tools.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

KLX Energy Services Holdings Inc has a Value Score of 82, which is considered to be undervalued.

KLX Energy Services Holdings Inc’s price-earnings ratio is 2.8 compared to the industry median at 14.4. This means that it has a lower price relative to its earnings compared to its peers. This makes KLX Energy Services Holdings Inc more attractive for value investors.

KLX Energy Services Holdings Inc’s price-to-book ratio is lower than its peers. This could make KLX Energy Services Holdings Inc more attractive for value investors when compared to the industry median at 1.28.

You can read more about KLX Energy Services Holdings Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Mattr Corp (USA)’s Value Grade

Value Grade:

Mattr Corp., formerly Shawcor Ltd., is a global material technology company serving critical infrastructure markets, including electrification, transportation, communication, water management and energy. The Company operates through a network of fixed and mobile manufacturing and service facilities. The Company operates through two business segments: Composite Technologies and Connection Technologies. Composite Technologies segment consist of two operating units: the Xerxes business, which manufactures fiberglass reinforced plastic underground storage tanks primarily for the retail fuel, storm water and wastewater markets; and the FlexPipe business, which manufactures flexible fiberglass reinforced composite pipe used for oil and gas gathering and water disposal lines and carbon dioxide injection lines. Connection Technologies segment supplies specialty wire and cable and integrated heat shrink solutions.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Mattr Corp (USA) has a Value Score of 65, which is considered to be undervalued.

Mattr Corp (USA)’s price-to-book ratio is lower than its peers. This could make Mattr Corp (USA) fairly attractive for value investors when compared to the industry median at 1.28.

You can read more about Mattr Corp (USA)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

North American Construction Group Ltd’s Value Grade

Value Grade:

North American Construction Group Ltd. is a Canada-based company, which provides heavy civil construction and mining services in Canada, the United States, and Australia. It provides a range of mining and heavy construction services to customers in the resource development and industrial construction sectors. The Company’s Heavy Construction and Mining division is engaged in hard rock and oil sands mining, overburden removal, mine site development, and mine reclamation. This division also provides constructability design reviews, budgetary cost estimates, and a range of planning and scheduling services. The Company’s Equipment Maintenance Services division offers maintenance procedures on-site, as well as in its multiple shop facilities. It provides services, such as fuel and lube servicing options, portable steaming, equipment inspections, hose manufacturing and onsite haul truck brake testing. The Company also provides heavy earthworks solutions to the mining and civil sectors.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

North American Construction Group Ltd has a Value Score of 62, which is considered to be undervalued.

North American Construction Group Ltd’s price-earnings ratio is 14.4 compared to the industry median at 14.4. This means that it has a higher price relative to its earnings compared to its peers. This makes North American Construction Group Ltd fairly attractive for value investors.

North American Construction Group Ltd’s price-to-book ratio is lower than its peers. This could make North American Construction Group Ltd more attractive for value investors when compared to the industry median at 1.28.

You can read more about North American Construction Group Ltd’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Bristow Group Inc’s Value Grade

Value Grade:

Bristow Group Inc. is a provider of vertical flight solutions. The Company primarily provides aviation services to a broad base of offshore energy companies and government entities. The Company?s aviation services include personnel transportation, search and rescue (SAR), medevac, fixed-wing transportation, unmanned systems, and ad-hoc helicopter services. It focuses on helicopter service contracts and fixed-wing service contracts. The Company owns and operates classes of helicopters, such as heavy helicopters, medium helicopters, light helicopters, and single-engine helicopters. It is an operator of each of the S92, AW189, and AW139 helicopter models. It serves customers in Australia, Brazil, Canada, Chile, the Dutch Caribbean, the Falkland Islands, Guyana, India, Mexico, the Netherlands, Nigeria, Norway, Spain, Suriname, Trinidad, the United Kingdom (U.K.) and the United States (U.S.). The Company?s fleet includes 227 aircraft located across six continents and 17 different countries.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Bristow Group Inc has a Value Score of 68, which is considered to be undervalued.

Bristow Group Inc’s price-to-book ratio is higher than its peers. This could make Bristow Group Inc less attractive for value investors when compared to the industry median at 1.28.

You can read more about Bristow Group Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Oil & Gas - Related Services and Equipment Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Oil & Gas - Related Services and Equipment stocks as well as other industrys.

Choosing Which of the 6 Best Oil & Gas - Related Services and Equipment Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Gulf Island Fabrication, Inc. stock has a Value Grade of B.
• Koil Energy Solutions Inc stock has a Value Grade of A.
• KLX Energy Services Holdings Inc stock has a Value Grade of A.
• Mattr Corp (USA) stock has a Value Grade of B.
• North American Construction Group Ltd stock has a Value Grade of B.
• Bristow Group Inc stock has a Value Grade of B.

Now that you have a bit more background about each of the 6 undervalued stocks in the Oil & Gas - Related Services and Equipment industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Oil & Gas - Related Services and Equipment Stocks

Want to learn more about Oil & Gas - Related Services and Equipment stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 6 Undervalued Oil & Gas - Related Services and Equipment Stocks for Wednesday, February 28
• 4 Undervalued Oil & Gas - Related Services and Equipment Stocks for Tuesday, February 27
• Why Dril-Quip Inc’s (DRQ) Stock Is Up 10.22%
• Why Helix Energy Solutions Group Inc’s (HLX) Stock Is Down 11.12%

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