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National Oilwell Varco - Caution In The Short Run, Optimistic In The Long Run

Shares of National Oilwell Varco (NOV) continue to be under pressure, at a time when many other oilfield service suppliers and other energy companies have seen a big jump in recent weeks.

This relative underperformance is kind of surprising to me, given that its latest results do not indicate real weakness yet, although the order intake has been very soft in some areas. I still do not have reasons to believe that this lower backlog results from execution issues.

That said, more downside might be ahead as estimates are still on the high side, although I think investors will see returns in the long run.

Quick Fourth Quarter Recap

National Oilwell Varco posted fourth quarter revenues of $5.71 billion, a 7.7% increase on an annual basis as revenues were still up by 2.2% on a sequential basis.

Earnings came in at $595 million which is down by 9.6%… Read More …