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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Nov Inc. (XNYS:NOV) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
NOV
Name:
NOV INC. (XNYS:NOV)
Sector:
- 149000.00K
Industry:
Oil & Gas Equipment & Services
CEO:
Mr. Clay Williams
Total Employees:
27,043
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -53.23% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF NOV INC.(NOV) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND OIL & GAS EQUIPMENT & SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
17.72
One Month Price Target:
$17.9
Six Month Price Target :
$18.81
Likely Price in One Year's Time:
Ticker:
$19.89
Likely Trading Range Today Under (Normal Volatility)
$17.6
Price Upper limit ($) :
$17.85
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$16.2
This week:
$14.33
This month :
$10.94
Other Primary facts
Market Cap:
6.79B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
392.80M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
27.33%
-28.95%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$24.76
$21.54
$10.68
$13.90
Medium risk (<10%) entry points
Buy Call
Sell Call
$20.49
Buy Put:
Sell Put:
$19.81
$14.94
$15.63
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
NOV
Sharpe Ratio:
0.89%
Comparison:
NOV, is amongst the top 60% stocks with highest risk-adjusted returns
Sharpe ratio is -41.37% lower than the industry
& is -61.14% lower than the market/S&P 500 average
Average Returns/Yield of
NOV
Daily returns:
0.05%
Weekly returns:
0.23%
Monthly returns:
0.92%
Yearly returns:
19.19%
Comparison of returns:
Average annual returns/yield (last 3 years) is -42.53% below industry average
Classification:
NOV, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.85
Statistical test of Returns:
NOV has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
4.19%
Weekly Volatility:
9.36%
Monthly Volatility:
18.73%
Yearly Volatility:
64.87%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
3.72%
Volatility in last five trading days has been -11.21% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-8.55%
Weekly VaR:
-19.13%
Monthly VaR:
-38.26%
How Much Can the price of
NOV
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-33%
Worst case (decline):
>85%
This translates to price declining to:
$11.82
This translates to price declining to:
$2.66
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
NOV is a 170.01% riskier investment compared to the market/S&P 500 & is 131.32% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -2.39% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
NOV
Beta in relation to market/S&P 500--1.83
Expected beta in 1 year's time:
1.039
Expected beta in 3 year's time:
1.469
Unlevered (debt free) Beta:
1.162
Beta in relation to Nasdaq (XNAS):
0.899
Beta in relation to all global stocks::
1.096
Beta Comparison & Analysis
Beta of competitors/peers::
1.689
Beta is 8.09% higher than peers
Average Industry Beta:
23.957
Beta is -92.38% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
-0.046
Alpha is -96.87% below industry average alpha yield
Alpha is -295% below the market average
Analysis of Cost of Capital of
NOV
Equity cost of capital:
0.157
Equity cost of capital is -90.64% below industry mean WACC
Unlevered (without debt) cost of capital:
9.96%
Before-tax cost of debt:
2.40%
After-tax cost of debt:
1.90%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.90%
WACC is -86.45% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$14.82
Revenue growth rate per share of (3Y):
1.39
Annual revenue growth rate is -134.25% below industry average
EPS:
-$0.48
Expected Annual growth rate of EPS (3Y):
-65.59%
Expected future EPS growth rate is 174.70% higher than the Oil & Gas Equipment & Services industry
Free cash flow (FCF) per share:
$0.04
Balance sheet equity growth per share: -74.30%
Equity growth rate per share is 21.70% higher than the industry
Debt per share
$5.80
EBITDA per share
$0.52
Valuation Analysis Today of
NOV
P/E Ratio:
0
P/E Ratio of Competitors/Peers:
12.22
P/E ratio is -100.00% lower than main peers & is higher than the industry
-
NOV is -245.27% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $7.37
Present value of the expected future dividends only: $1.28
P/S (Price to Sales ratio):
1.2
Price to sales ratio is -21.48% below the industry mean
P/B (Price to book value ratio):
1.39
Price to free cash flow: 403.15
Price to free cash flow ratio is 196.89% higher than the industry
Net income growth rate (3Y):
671.94%
Net income growth rate is 703.45% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: -10.64%
Dividend yeild: 1.13%
Previous Dividend: $0.05
Previous adjusted dividend: $0.05
Previous Dividend: $0.20
-
-
Average dividend payment (long-term): $0.05
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 22/09/2022
Expected next dividend record date: 09/08/2022
-
Previous dividend payment date: 24/06/2022
Previous dividend record date: 06/10/2022
-
Dividend History:
2022-06-09--$0.05
2021-12-02--$0.05
2019-12-05--$0.05
2022-03-10--$0.05
2020-03-12--$0.05
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
46.04%
Net debt to equity ratio:
19.59%
Debt to assets ratio:
23.84%
Net debt to assets ratio:
10.14%
Debt-to-asset ratio is -56.91% below industry average
Ability to repay debt:
Interest coverage ratio:
3.6
Interest coverage ratio is 19.30% more than industry average
Looking forward:
Debt growth rate:
-25.43%
Annual debt growth is -132% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.26%
Analysis of Key Statistics
Correlation of price movement with the market:
0.523
Statistical significance of correlation:
NOV has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.416
Stock price is 25.68% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.416
Correlation of price movement with Nasdaq (^IXIC):
0.052
Covariance of price movement with the market:
0.126
Kurtosis
7.754
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.153
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
NOV
Gross Profit Margin Ratio:
57%
Operating Profit Margin Ratio:
-1.15%
Operating profit margin is -53.53% lower than the industry
Net Profit Margin Ratio:
57%
Effective Tax Rate:
-24.14%
Effective tax rate is -151.53% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-3.80%
Return on equity (ROE) is -89.38% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-1.97%
Return on assets (ROA) is -57.22% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
2.5
Current ratio is 8.01% above industry average
Cash Conversion Cycle (days):
65.5
Cash conversion cycle is 1.93% above industry average
The remaining useful life of property plant & equipment is: 9.8 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
215.3K
Each employee generates -19% less revenue than industry average revenue per employee
EBITDA generated per employee:
7.6K
Each employee generates -78% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 7.0K
Each employee generates -235% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 5.5K
Each employee generates 25% more free cash flow than industry average revenue per employee
Assets/Capital per employee
170.2K
Each employee generates 25% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
NOV
NATIONAL FUEL GAS COMPANY (XNYS:NFG)
Sinopec Shanghai Petrochemical Company Limited (XNYS:SHI)
ANTERO RESOURCES CORPORATION (XNYS:AR)
HF SINCLAIR CORPORATION (XNYS:DINO)
VALVOLINE INC. (XNYS:VVV)
Cosan SA (XNYS:CSAN)
SOUTHWESTERN ENERGY COMPANY (XNYS:SWN)
SHELL MIDSTREAM PARTNERS UNT (XNYS:SHLX)
ANTERO MIDSTREAM CORPORATION (XNYS:AM)
Current Analyst Ratings
Strong buy�4%
Buy�29%
Hold�92%
Sell�17%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
5.82B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
4.99B
832.00M
-
-
899.00M
-
-
899.00M
6.00M
57.00M
301.00M
205.00M
- 67000.00K
- 188000.00K
- 145000.00K
35.00M
- 188000.00K
Statement of Cash Flow
Date:
Period:
74.00M
Differed Income Tax :
- 3000.00K
Stock Based Compensation :
-
Change in Working Capital :
- 197000.00K
Accounts Receivables:
- 156000.00K
Other Working Capital:
24.00M
Other Non-Cash Items:
72.00M
Net Cash Provided by Operating Activities:
- 103000.00K
Investments in PP&E:
- 46000.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
1.41B
-
1.41B
1.90B
1.44B
205.00M
4.95B
2.33B
1.53B
495.00M
62.00M
-
194.00M
4.60B
-
9.55B
643.00M
98.00M
114.00M
403.00M
835.00M
1.98B
2.28B
221.00M
2.56B
-
4.54B
4.00M
- 2216000.00K
- 1532000.0K
-
March 31, 2022 at 6:00:00 AM
5.89B
4.95B
9.49B
-
2.38B
969.0M
-
- 3000.00K
- 49000.00K
- 6000.00K
-
-
- 20000.00K
- 10000.00K
- 36000.00K
3.00M
- 185000.00K
1.41B
1.59B
- 103000.00K
- 46000.00K
- 149000.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
NOV
2023
2024
2025
2026
2027
$16.90
$18.97
$21.30
$23.91
$26.85