Company Reports

ChampionX is a diversified oilfield-services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals. The firm is one of the largest specialty chemicals providers in oilfield services: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX delivered solid first-quarter results, with total revenue reaching $922 million, the midpoint of management’s guidance, and firmwide adjusted EBITDA of $192 million exceeding the high end of the guidance range by approximately $3 million. Most segments saw sequential revenue growth, driven by higher sales volume of select products and overall higher demand in North America. However, this was offset by revenue contraction in the production chemical technologies segment (65% of total revenue) due to seasonal declines internationally. Weaker global end-market demand at this time of the year is typical, and we expect activity to pick back up in the warmer months. Our $46 fair value estimate and no-moat rating for ChampionX are unchanged, as is our $62 fair value estimate for SLB.

ChampionX is a diversified oilfield-services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals. The firm is one of the largest specialty chemicals providers in oilfield services: ChampionX and Baker Hughes together control roughly half of the global market.

SLB has agreed to acquire ChampionX in an all-stock transaction to be completed by the end of 2024. After incorporating ChampionX into our SLB model, our fair value estimate remains unchanged at $62 as does our narrow moat rating. Our ChampionX fair value estimate increases to $46 from $32, as it reflects SLB’s offer of 0.735 SLB shares for each share of ChampionX. We consider this a good outcome for ChampionX shareholders. The overpayment by SLB based on our prior ChampionX fair value estimate is not material enough to move our SLB fair value.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX closed out 2023 on solid footing and exited the year near the midpoint of management guidance for fourth-quarter performance. Revenue held flat sequentially and contracted about 4% year over year. The firmwide adjusted EBITDA margin also held flat sequentially but expanded nearly 300 basis points year over year. We’re maintaining our no moat rating and $32 fair value estimate following results. At the time of writing, shares trade at a roughly 10% discount to our fair value estimate.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX’s third-quarter results fell short of expectations mainly due to lower-than-expected drilling and completions activity across North America. More than half of the firm’s revenue comes from the United States, and the firm has quite a bit of exposure to shorter-cycle U.S. markets. The average active rig count in the U.S. dropped 10% during the quarter, while new well completions declined about 8%. This led to a significant shortfall in revenue and operating income, falling short of the guidance midpoints by $35 million and $13 million, respectively. We’re lowering our fair value estimate to $32 per share from $33 following the results. We are maintaining our no-moat rating.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX performed well in the second quarter despite headwinds from numerous external sources, including production shutdowns relating to Canadian wildfires and logistics-related shipment delays in Latin America, as well as decelerating activity across North America. ChampionX’s profitability improved despite a modest sequential revenue decline of 2%, with the firmwide adjusted EBITDA margin expanding nearly 160 basis points quarter over quarter. Few challenges from second quarter will likely carry over into the second half of the year, but we expect overall modest performance improvements in the future, as constrained North American activity offsets growth in international markets. Our $33 per share fair value estimate and no-moat rating are therefore unchanged.

No-moat ChampionX posted solid first-quarter results, with revenue increasing 10% year over year and firmwide adjusted EBITDA margin increasing 400 basis points over the same period. Sequentially, top-line growth dropped 4% due to standard seasonality in the firm’s non-North American markets, yet the firm’s adjusted EBITDA margin jumped 40 basis points owing to favorable pricing movements and internal productivity gains. We remain optimistic regarding ChampionX’s 2023 prospects and thus maintain our $33 fair value estimate following results.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

ChampionX’s fourth-quarter results came in at the lower end of the firm’s guidance, with revenue just shy of $1 billion and adjusted EBITDA of $179 million. Revenue decreased 3% quarter over quarter due to standard seasonal slowdowns as well as divestiture of certain product lines in the firm’s reservoir chemicals business. On a year-over-year basis, fourth-quarter revenue expanded 20% due to a favorable pricing environment and increasing production activity worldwide, two trends we expect will persist in 2023. Following results, we’re raising our fair value estimate to $33 from $25, as a result of our improved outlook regarding the ChampionX’s potential for profitable growth through 2023 and beyond.

ChampionX delivered a strong third quarter, beating the high end of its revenue and EBITDA guidance by 7% and 6%, respectively. We’re slightly raising our fair value estimate to $25 from $23 following results. Our no-moat rating, stable moat trend, and Morningstar Uncertainty Rating of High are unchanged.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.

We’re launching coverage of ChampionX with a fair value estimate of $23. ChampionX is one of the largest providers of specialty chemical solutions for oil and gas production. It also offers artificial lift solutions, manufactures polycrystalline diamond cutter drill bit inserts, and is breaking into the automation space for applications within oil and gas production. The firm has no moat and a Stable moat trend.

ChampionX is a diversified oilfield services firm providing specialty chemicals solutions and artificial lift services for oil and gas development and production. It also manufactures polycrystalline diamond cutter, or PDC, inserts for drilling and mining rigs. About two thirds of ChampionX’s overall business involves specialty chemicals, and the firm is one of the largest specialty chemicals providers in the oilfield services space: ChampionX and Baker Hughes together control roughly half of the global market.