StockStory Flags Margin and Cash-Flow Concerns at Three Energy Firms

StockStory highlighted Murphy Oil, Patterson-UTI and NESR as energy stocks with concerns in their operating performance. The publisher cited rising costs and pressure on margins at Murphy Oil and NESR, and weak free cash flow at Patterson-UTI.

For Murphy Oil, StockStory said costs grew faster than revenue over the past five years. It said the company’s EBITDA margin, a measure of operating profitability, fell 5.1 percentage points.

Patterson-UTI’s gross margin was 29.9%, which StockStory said left the company reliant on higher production volumes. The publisher also cited a flat EBITDA margin over five years and an average free cash flow margin of 5.8% during that period.

StockStory said NESR’s $1.62 billion revenue base limited its ability to benefit from scale. It also pointed to a gross margin of 12.8% and said the company’s EBITDA margin fell 74.1 percentage points over five years as expenses grew relative to revenue.