The
following is a small-cap-insight column, on a company with a market cap of $5
billion, published by Seeking Alpha.
Superior
Energy Services (NYSE:SPN) is eyeing a turnaround through significant growth at
the Gulf of Mexico and international markets. The stock is a buy and presents a
33% upside from current price levels.
Superior
Energy Services (SPN)
is a Houston based oilfield services firm which provides oilfield services and
equipment to both onshore and offshore operators. The company initially started
out as an oilfield products manufacturing firm but then expanded its operations
into the services market. The company has been operating in the United States
for more than two decades and has significant operations across all the primary
basins. During this period, Superior achieved considerable growth and went from
making annual revenues of $12 million in its early days to its present TTM revenues
of $4.65 billion.
Recent
Growth and Future Estimates
Since 2012,
Superior increased its focus on the land markets and is using its strong
cash-flow generation abilities to expand in the international markets. This was
evident in its last year's sale of its liftboat fleet to SEACOR Marine and the
merger with Complete Production Services in which Superior
purchased Complete Production through a $2.7 billion cash and stock deal which significantly increased Superior's exposure
to North America's land market. Then earlier this year, in March 2013, Superior
purchased 100% equity interest in a South American firm which provides
cementing services to energy companies of Colombia, thereby expanding its
operations in the continent. For this acquisition, Superior has paid $20.4
million and will make an additional payment of $3.7 million.
After the
Complete Production acquisition, Superior started posting significant increase
in revenues as the company went from making average quarterly revenues of less
than $500 million in 2011 to more than … read full article at Seeking Alpha
