Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 4 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.

Latest Oil & Gas - Related Services and Equipment Stock News

Before choosing which top Oil & Gas - Related Services and Equipment stock to buy, be sure to conduct proper due diligence: analyze various financial metrics and look at historical data, public statements and news coverage.

The fundamental outlook for the oil & gas related services & equipment sub-industry is neutral for the next 12 months. Oil prices rebounded from lows during the pandemic to all-time highs in spring of 2022. Global oil demand is expected to exceed pre-pandemic levels, but inadequate supply levels add additional stress to an already tight market. Oil producers are increasing their capital spending for 2022, paving the way for more production while driving up demand for oil services. Despite this, the industry faces challenges heading into late 2022. Labor, equipment maintenance and supplies are all getting more costly. Oil services companies are also experiencing a shortage of sand used for fracking, rigs and fracking crews.

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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4 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 4 undervalued stocks in the Oil & Gas - Related Services and Equipment industry for Wednesday, April 26, 2023. 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.

Profrac Holding Corp’s Value Grade

Value Grade:

ProFrac Holding Corp. is a vertically integrated energy services company. The Company is engaged in providing hydraulic fracturing, completion services and other complementary products and services to upstream oil and gas companies engaged in the exploration and production (E&P;) of North American unconventional oil and natural gas resources. It provides in-basin sand in North America. Its four mines produces approximately 10.4 million tons per year of proppant. Its solutions to the North American Oil and Gas industry include project design and manufacturing, sand and chemical supply, logistics coordination and data reporting, automation technology, emissions reduction, and additive manufacturing. The Company also provides pressure pumping services with operations in the Rockies and Eagle Ford. It operates frac fleets totaling 204,500 hydraulic horsepower that offer opportunity for upgrades through the additions of dynamic gas blending (DGB) engines and engine idle reduction systems.

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.

Profrac Holding Corp has a Value Score of 73, which is considered to be undervalued.

When you look at Profrac Holding Corp’s price-to-sales ratio at 0.25 compared to the industry median at 0.68, this company has a lower price relative to revenue compared to its peers. This could make Profrac Holding Corp’s stock more attractive for value investors.

Profrac Holding Corp’s price-earnings ratio is 5.67 compared to the industry median at 18.74. This means it has a lower share price relative to earnings compared to its peers. This could make Profrac Holding Corp more attractive for value investors.

Now, let’s assess Profrac Holding Corp’s EV/EBITDA ratio, also known as enterprise multiple. At 6.6, when compared to the industry median of 8.3, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

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. Profrac Holding Corp’s shareholder yield is lower than its industry median ratio of (0.74%). 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.

Lastly, let’s take a look at Profrac Holding Corp’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Profrac Holding Corp’s price-to-free-cash-flow ratio is lower than its industry median ratio of 28.10. This could make Profrac Holding Corp more attractive because the lower P/FCF ratio indicates that Profrac Holding Corp 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.

Geospace Technologies Corporation’s Value Grade

Value Grade:

Geospace Technologies Corporation designs and manufactures seismic instruments and equipment. It operates through three segments: Oil and Gas Markets, Adjacent Markets and Emerging Markets. The Oil and Gas Markets segment products include wireless seismic data acquisition systems, reservoir characterization products and services, and traditional seismic exploration products, such as geophones, hydrophones, leader wire, connectors, cables, marine streamer retrieval and steering devices and various other seismic products. Adjacent Markets segment products include imaging equipment, water meter products, remote shut-off valves and IoT platform, as well as seismic sensors used for vibration monitoring and geotechnical applications, such as mine safety applications and earthquake detection. The Emerging Markets segment designs and markets seismic products targeted at the border and perimeter security markets. Its seismic products are marketed to the oil and gas industry along with others.

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.

Geospace Technologies Corporation has a Value Score of 71, which is considered to be undervalued.

Geospace Technologies Corporation’s price-to-book ratio is higher than its peers. This could make Geospace Technologies Corporation less attractive for value investors when compared to the industry median at 1.19.

You can read more about Geospace Technologies Corporation’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.

Nextier Oilfield Solutions Inc’s Value Grade

Value Grade:

NexTier Oilfield Solutions Inc. is a land oilfield-focused service company, with a diverse set of well completion and production services across various basins in the United States. The Company operates through two segments: Completion Services and, Well Construction and Intervention Services. Its Completion Services segment consists of various businesses and services lines, hydraulic fracturing services; wireline and pumping services, and completion support services, which includes its Power Solutions natural gas fueling business, its proppant last mile logistics and storage business, and its research and technology (R&T;) department. Its Well Construction and Intervention Services segment consists of its cementing services business. Its cementing services include custom engineered mixing and blending equipment that provides annulus isolation and hydraulic seal, while protecting freshwater zones from its customers? zone of interest.

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.

Nextier Oilfield Solutions Inc has a Value Score of 69, which is considered to be undervalued.

Nextier Oilfield Solutions Inc’s price-earnings ratio is 6.5 compared to the industry median at 18.7. This means that it has a lower price relative to its earnings compared to its peers. This makes Nextier Oilfield Solutions Inc more attractive for value investors.

Nextier Oilfield Solutions Inc’s price-to-book ratio is lower than its peers. This could make Nextier Oilfield Solutions Inc more attractive for value investors when compared to the industry median at 1.19.

You can read more about Nextier Oilfield 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.

North American Construction Group Ltd’s Value Grade

Value Grade:

North American Construction Group Ltd. is a Canada-based company that provides a range of mining and heavy construction services to customers in the resource development and industrial construction sectors within Western Canada but also in other parts of Canada, the United States and Australia. The Company's operating divisions include Heavy Construction and Mining, and Equipment Maintenance Services. The 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 Equipment Maintenance Services division offers maintenance procedures on-site, as well as in its multiple shop facilities. It provides various services, including fuel and lube servicing options, portable steaming, equipment inspections, hose manufacturing and onsite haul truck brake testing.

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 73, which is considered to be undervalued.

North American Construction Group Ltd’s price-earnings ratio is 11.6 compared to the industry median at 18.7. This means that it has a lower price relative to its earnings compared to its peers. This makes North American Construction Group Ltd more 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 1.19.

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.

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 4 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.

• Profrac Holding Corp stock has a Value Grade of B.
• Geospace Technologies Corporation stock has a Value Grade of B.
• Nextier Oilfield Solutions Inc stock has a Value Grade of B.
• North American Construction Group Ltd stock has a Value Grade of B.

Now that you have a bit more background about each of the 4 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.

• 4 Undervalued Oil & Gas - Related Services and Equipment Stocks for Wednesday, April 26
• 4 Undervalued Oil & Gas - Related Services and Equipment Stocks for Tuesday, April 25
• Why Aris Water Solutions Inc’s (ARIS) Stock Is Down 5.03%
• Why Cactus Inc’s (WHD) Stock Is Down 4.55%

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