Financial Data and Key Metrics Changes - The company reported revenue of $193 million and EBITDA of $20 million for the first quarter, meeting expectations [16] - Orders increased by 6% to $201 million, resulting in a book-to-bill ratio of 104% [16] - Free cash flow generated in the first quarter was $7 million, three times higher than the same period last year, marking the seventh consecutive quarter of positive free cash flow generation [22] Business Line Data and Key Metrics Changes - The Drilling and Completion segment saw a revenue increase of $5 million, driven by a rebound in sales of consumables and capital equipment [17] - The artificial lift and downhole segment experienced a decline in revenues due to unfavorable product mix and timing of shipments [18] - The Valve Solutions product line faced negative headwinds due to tariffs impacting demand, leading to a buyer strike [20] Market Data and Key Metrics Changes - Oil prices have declined significantly, hovering near four-year lows, which may lead to a reduction in rig counts and revenue starting in the third quarter if prices do not rebound [8] - The company anticipates a modest 2% to 5% decline in global drilling and completions activity for the year, with North America rig count expected to soften [13] Company Strategy and Development Direction - The company is focusing on mitigating tariff impacts, optimizing the supply chain, and reducing costs and inventory [9] - Plans include increasing assembly activities in Saudi Arabia and Canada to serve global markets more efficiently [11] - The company aims to utilize 50% of free cash flow for debt reduction and the remaining for strategic investments, including share repurchases [24] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about economic uncertainty due to trade policies and commodity price pressures, indicating a potential decline in revenue if oil prices do not recover [7][8] - The company remains confident in its ability to generate free cash flow and maintain a strong balance sheet, with no debt maturities until 2028 [23] - Long-term growth is expected to be driven by increasing energy demand due to population growth and economic expansion [29] Other Important Information - The company has strategically de-risked its supply chain to minimize dependence on specific countries and provide sourcing flexibility [11] - The balance sheet has improved significantly, with a net debt of $146 million and a net leverage ratio of 1.56 times [23] Q&A Session Summary Question: Can you elaborate on the strength in the Subsea side despite a slowdown in rig counts? - Management highlighted strong bookings in Subsea due to customer adoption of new products and a significant market share in remote-operated vehicles [35][36] Question: What products saw strength in the drilling completion segment? - Management noted a rebound in sales of frac pump power ends and wireline products, indicating increased activity despite fewer crews [38][40] Question: How are share repurchases managed in relation to leverage ratios? - Management explained that share repurchases are timed based on net debt measurements within 30 days of buying back shares, allowing flexibility in execution [46][47] Question: What is the impact of tariffs on pricing and demand? - Management acknowledged that tariffs have led to a buyer strike in the valve product line, affecting demand and pricing strategies [54][82] Question: How does the company plan to manage cash and debt reduction? - The company plans to use half of its free cash flow for net debt reduction and will continue to monitor market conditions for share repurchases [84][85] Question: What is the outlook for the Veraperm product line in Canada? - Management indicated that the recent performance was temporary and attributed to customer and product mix, with expectations for improvement in the second half of the year [63][65]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $193 million, with EBITDA of $20 million, meeting expectations [16] - Orders increased by 6% to $201 million, resulting in a book-to-bill ratio of 104% [16] - Free cash flow generated in Q1 was $7 million, three times higher than the same quarter last year, marking the seventh consecutive quarter of positive free cash flow [21][22] Business Line Data and Key Metrics Changes - The Drilling and Completion segment saw a revenue increase of $5 million, driven by a rebound in sales of completions-related consumables and capital equipment [17] - The artificial lift and downhole segment experienced a revenue decline due to unfavorable product mix and softer demand for Veraperm products [18] - The Valve Solutions product line faced negative headwinds due to tariffs impacting demand, leading to a buyer strike and reduced orders [19] Market Data and Key Metrics Changes - Oil prices have declined significantly, hovering near four-year lows, which may lead to a reduction in global rig count in the second half of the year [8] - The company anticipates a modest 2% to 5% decline in global drilling and completions activity for the full year [13] - Despite market uncertainty, operators have not materially deviated from their plans, with expectations for flat quarter-over-quarter results in Q2 [20] Company Strategy and Development Direction - The company is focusing on mitigating tariff impacts, optimizing the supply chain, and reducing costs and inventory [9] - Plans include increasing assembly activities in Saudi Arabia and Canada to efficiently serve global markets [10] - The company aims to utilize 50% of free cash flow for debt reduction and the remaining for strategic investments, including share repurchases [24] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about the economic uncertainty due to U.S. trade policies and OPEC's supply growth, which could pressure commodity prices [7] - The company remains confident in its ability to generate free cash flow and maintain a strong balance sheet, with no debt maturities until 2028 [23] - Long-term growth potential is viewed positively, driven by increasing energy demand due to population growth and economic expansion [28] Other Important Information - The company has strategically de-risked its supply chain to minimize dependence on specific countries [11] - A focus on expense and inventory management has led to the highest level of free cash flow in nearly a decade in 2024 [12] Q&A Session Summary Question: Subsea bookings and product adoption - Management highlighted a 60% quarter-over-quarter increase in subsea bookings due to customer adoption of new products, with strong demand for remote-operated vehicles [34][35] Question: Strength in drilling completion orders - The increase in orders for stimulation-related equipment was attributed to a rebound from low purchase levels at the end of the previous year, with crews working more efficiently [36][38] Question: Share repurchases and leverage ratio - Management clarified that share repurchases were executed despite ending the quarter slightly above the 1.5 leverage ratio, with plans to continue as cash flows allow [44][45] Question: Cost reduction efforts - The company is targeting $10 million in annualized cost reductions, with some benefits expected in Q2 and more in Q3 [46][47] Question: Customer behavior regarding pricing and tariffs - Management noted that customers are currently hesitant to purchase due to high prices and tariff uncertainty, leading to a buyer strike [51][52] Question: Seasonal impacts in Canada for Veraperm - Management indicated that the challenges faced by Veraperm in Canada are temporary and linked to customer and product mix, with expectations for improvement in the second half of the year [60][61] Question: Geographical diversification benefits - The company is leveraging its geographical diversification to mitigate tariff impacts and optimize manufacturing processes [74][75]

Financial Performance - First quarter 2025 revenue was $193 million, with a net income of $1 million or $0.09 per diluted share[2] - Total revenue for the three months ended March 31, 2025, was $193.3 million, a decrease of 4.5% compared to $202.4 million for the same period in 2024[21] - The company reported a net income of $1.1 million for Q1 2025, a significant improvement from a net loss of $10.3 million in Q1 2024[27] - Operating income for the three months ended March 31, 2025, was $8.8 million, representing an operating margin of 4.6%, compared to $3.2 million and 1.6% in the same period of 2024[25] - EBITDA for Q1 2025 was $18.9 million, with an EBITDA margin of 9.8%, compared to $15.8 million and 7.8% in Q1 2024[25] Cash Flow - Free cash flow generated in Q1 2025 was $7 million, marking the seventh consecutive quarter of positive free cash flow[4] - The company maintains its full year 2025 free cash flow guidance of $40 to $60 million[5] - Free cash flow before acquisitions for Q1 2025 was $7.2 million, significantly up from $2.3 million in Q1 2024[29] - Net cash provided by operating activities was $9.3 million in Q1 2025, up from $5.0 million in Q1 2024[29] - The Company emphasizes that free cash flow before acquisitions is a critical measure for evaluating profitability and capital management[29] Segment Performance - Drilling and Completions segment revenue rose 4% to $116 million, driven by increased demand for completions equipment[7] - Artificial Lift and Downhole segment revenue decreased 13% to $78 million, primarily due to reduced demand for valve products[8] - Revenue from the Drilling and Completions segment was $115.6 million, accounting for 59.8% of total revenue in Q1 2025[32] - The Stimulation and Intervention segment generated $37.4 million in revenue, representing a 19.3% share of total revenue for Q1 2025[32] - Downhole revenue was $47.7 million, making up 24.7% of total revenue in Q1 2025[32] - The Artificial Lift and Downhole segment contributed $77.8 million, which is 40.2% of total revenue for Q1 2025[32] Orders and Book-to-Bill Ratio - Orders totaled $201 million with a book-to-bill ratio of 104%[6] - Orders for Drilling and Completions increased to $132.1 million in Q1 2025, up 13.3% from $116.6 million in Q1 2024[23] - The total book-to-bill ratio for the company was 1.04 in Q1 2025, indicating improving market demand compared to 1.01 in Q1 2024[23] - Total orders for the company were $200.7 million in Q1 2025, slightly down from $204.4 million in Q1 2024[23] Cost Management - The company is implementing actions to eliminate $10 million in annualized costs to adapt to potentially lower demand levels[3] - Adjusted EBITDA for Q1 2025 was $20 million, despite tariff uncertainties impacting results[6] - For Q2 2025, adjusted EBITDA is expected to be in the range of $18 to $22 million[5] Impairment and Capital Expenditures - The company experienced a significant impairment of intangible assets amounting to $119.1 million in Q4 2024, impacting overall financial performance[25] - Capital expenditures for property and equipment were $2.1 million in Q1 2025, compared to $2.9 million in Q1 2024[29] - The Company reported proceeds from sale-leaseback transactions of $20.3 million in Q4 2024, which positively impacted cash flow[29]

Core Viewpoint - Forum Energy Technologies (FET) is expected to report first-quarter earnings on May 2, 2025, with earnings estimated at 43 cents per share and revenues at $196.3 million, reflecting a significant year-over-year earnings increase but a slight revenue decline [1][2]. Group 1: Earnings Expectations - The Zacks Consensus Estimate for FET's earnings indicates a 458.3% year-over-year increase [2] - Revenue estimates suggest a 3% decline compared to the previous year's actual figures [2]. Group 2: Business Operations - FET generates income primarily through manufacturing and selling consumable and capital equipment products, with additional revenue from rental services and aftermarket technical services [3]. - The company has seen a 15% year-over-year increase in market share in 2024, attributed to its focus on niche markets and differentiated technologies [4]. Group 3: Cost and Market Challenges - Rising costs, particularly in the fourth quarter, were driven by higher cost of sales and increased operating expenses, contributing to a net loss of $103.5 million [5]. - Management noted inflationary pressures and commodity price volatility, with expectations of a 2-5% decline in global drilling and completion activity in 2025, which may continue to impact margins [6]. Group 4: Earnings Prediction Model - The current model does not predict an earnings beat for FET, as the Earnings ESP is 0.00% and the Zacks Rank is 3 (Hold) [7][8].

Company Overview - Forum Energy Technologies, Inc. (FET) is a global manufacturer serving the oil and gas, industrial, and renewable energy sectors [1] - The company operates through two main segments: Drilling and Completions, and Artificial Lift and Downhole [1] Segment Details - The Drilling and Completions segment focuses on selling capital equipment [1] - The Artificial Lift and Downhole segment is also a key area of operation for the company [1]

Core Viewpoint - The article emphasizes the importance of value investing and highlights Forum Energy Technologies (FET) as a strong candidate for value investors due to its attractive financial metrics and strong earnings outlook [2][7]. Company Analysis - Forum Energy Technologies (FET) has a Zacks Rank of 1 (Strong Buy) and a Value grade of A, indicating it is among the strongest value stocks currently available [4]. - FET's P/E ratio stands at 7.35, significantly lower than the industry average of 11.41, suggesting it may be undervalued [4]. - The stock's Forward P/E has fluctuated between 6.63 and 49.18 over the past 52 weeks, with a median of 36.35, indicating volatility in its valuation [4]. - FET's P/B ratio is 0.58, which is attractive compared to the industry's average P/B of 0.99, further supporting the notion of undervaluation [5]. - The P/S ratio for FET is 0.23, compared to the industry average of 0.65, reinforcing its status as a potentially undervalued stock [6]. Industry Context - The article discusses the broader trend of value investing, which remains popular across various market conditions, and highlights the metrics used by value investors to identify undervalued companies [2][3].

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are ...

Therefore, the Zacks rating upgrade for Forum Energy basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price. Most Powerful Force Impacting Stock Prices Investors might want to bet on Forum Energy Technologies (FET) , as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). This upgrade primarily reflects an upward trend in earnings estimates, which is one of the most powerful forces impacting stock prices. The sole deter ...

Here are three stocks with buy rank and strong value characteristics for investors to consider today, March 31st: Kingstone Companies, Inc. (KINS) : This property and casualty insurance company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 22.6% over the last 60 days. Kingstone has a price-to-earnings ratio (P/E) of 8.94, compared with 20.18 for the S&P 500. The company possesses a Value Score of A. Forum Energy Technologies, Inc. (FET) : Th ...

The Oils-Energy group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Forum Energy Technologies (FET) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Oils-Energy sector should help us answer this question.Forum Energy Technologies is a member of our Oils-Energy g ...