On Friday, Hunting Plc (HTG:LN) (OTC: HNTIF) shares, a global energy services provider, saw its price target increased to GBP5.20 from GBP5.10, while its stock rating was maintained at Buy by Berenberg.
The adjustment reflects the company's strong performance in the oil-country tubular goods (OCTG) market, which has led to an improved forecast for the firm's financial year 2024 EBITDA.
According to the analyst, Hunting's order momentum in the OCTG sector is anticipated to persist, contributing positively to the company's outlook. This performance has provided the basis for the raised expectations. However, challenges remain as the US perforating market is experiencing a downturn, with reduced activity levels and a year-over-year decline in the rig count.
The Titan segment's future remains uncertain, with less confidence in a recovery for 2024. Despite this, significant contract wins, notably the major awards from the Kuwait Oil Company during the second quarter, have enhanced the visibility of Hunting's financial prospects for 2024 and 2025.
The company's guidance update and the subsequent price target increase reflect a mixed landscape in the energy services sector. While some areas are showing robust growth, others, like the US perforating market, are facing headwinds. Hunting's ability to secure substantial contracts and its strong performance in specific segments have contributed to the firm's favorable outlook for the coming years.
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