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Helmerich & Payne (HP)
NYSE:HP
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Helmerich & Payne
(NYSE:HP)
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Rating:54Neutral
Price Target:
$37.00
▲(7.15% Upside)
The score is held back primarily by weak recent financial performance (TTM revenue decline and net loss) and increased balance-sheet risk versus prior years, partially offset by resilient operating/free cash flow. Technicals are supportive with a strong uptrend, but overbought indicators add near-term risk. Valuation is mixed (reasonable yield, but negative P/E from losses). The latest earnings call was constructive on cash generation and deleveraging, though near-term activity and margin guidance imply continued volatility.
Positive Factors
Cash generation
Sustained positive operating and free cash flow, and strong TTM FCF growth, provide durable internal funding for CapEx, dividend payments and debt paydown. Reliable cash generation cushions cyclicality in drilling demand and supports strategic investments without immediate external financing.
Deleveraging and liquidity
Management has repaid ~65% of the term loan and maintains roughly $1.2B of total liquidity, materially improving financial flexibility. This durable progress lowers interest burden, reduces refinancing risk, and creates capacity to fund technology deployment and portfolio optimization.
Technology adoption & contract diversification
Adoption of FlexRobotics and margin gains from FlexRig units, combined with geothermal and international contract wins, strengthen H&P's competitive moat. Technology-driven efficiency and diversification into geothermal/international work reduce dependence on cyclical North America drilling over the medium term.
Negative Factors
Profitability deterioration
A material revenue decline and GAAP loss reverse prior multi-year profitability, eroding returns and retained earnings. Sustained weakness would limit reinvestment, pressure margins and weaken the company's ability to absorb future commodity-driven downturns despite positive EBITDA.
Elevated leverage vs. prior years
Significantly higher leverage compared with recent years reduces financial flexibility and raises sensitivity to rate and commodity shocks. Even with active paydown, the increased debt load constrains strategic optionality and increases the importance of consistent cash generation for covenant and refinancing risk management.
Asset impairments & idle rig base
Large non-cash write-downs and yarded/older rigs reflect structural excess capacity and the cost of reinvestment or retirement. These impairments signal lower recoverable value on legacy assets, potential recurring charges, and ongoing capex to modernize the fleet to maintain long-term utilization and margins.
Helmerich & Payne (HP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.70B
Dividend Yield3.24%
Average Volume (3M)1.39M
Price to Earnings (P/E)―
Beta (1Y)0.90
Revenue Growth35.89%
EPS Growth-148.39%
CountryUS
Employees7,000
SectorEnergy
Sector Strength52
IndustryOil & Gas Drilling
Share Statistics
EPS (TTM)-0.15
Shares Outstanding101,666,160
10 Day Avg. Volume1,877,591
30 Day Avg. Volume1,385,652
Financial Highlights & Ratios
PEG Ratio0.09
Price to Book (P/B)0.80
Price to Sales (P/S)0.59
P/FCF Ratio18.81
Enterprise Value/Market Cap0.86
Enterprise Value/Revenue0.78
Enterprise Value/Gross Profit5.88
Enterprise Value/Ebitda7.00
Forecast
1Y Price Target
$33.75Price Target Upside-2.26% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering13
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Helmerich & Payne Business Overview & Revenue Model
Company DescriptionHelmerich & Payne, Inc., together with its subsidiaries, provides drilling services and solutions for exploration and production companies. The company operates through three segments: North America Solutions, Offshore Gulf of Mexico, and International Solutions. The North America Solutions segment drills primarily in Colorado, Louisiana, Montana, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Texas, Utah, West Virginia, and Wyoming. It also focuses on developing, promoting, and commercializing technologies designed to enhance the drilling operations, as well as wellbore quality and placement. The Offshore Gulf of Mexico segment has drilling operations in Louisiana and in U.S. federal waters in the Gulf of Mexico. The International Solutions segment conducts drilling operations in Argentina, Bahrain, Colombia, and the United Arab Emirates. As of September 30, 2021, the company operated a fleet of 236 land rigs in North America; 30 international land rigs; and 7 offshore platform rigs. It also owns, develops, and operates commercial real estate properties. The company's real estate investments include a shopping center comprising approximately 390,000 leasable square feet; and approximately 176 acres of undeveloped real estate located in Tulsa, Oklahoma. Helmerich & Payne, Inc. was founded in 1920 and is headquartered in Tulsa, Oklahoma.
How the Company Makes MoneyHelmerich & Payne generates revenue primarily through its contract drilling services, which are billed on a day-rate basis. The company operates a diverse fleet of land and offshore drilling rigs, and its clients include major oil and gas exploration and production companies. The revenue model is heavily influenced by the demand for oil and gas, as well as the pricing environment within the industry. Key revenue streams include day rates for drilling services, which can vary based on rig type, location, and market conditions. Additionally, HP benefits from long-term contracts with clients, providing a stable income stream. The company also engages in the manufacturing of drilling rigs, contributing to its overall revenue through sales to third parties. Strategic partnerships with major energy firms and a focus on advanced drilling technologies further enhance its earnings potential, allowing HP to maintain a competitive edge in the market.
Helmerich & Payne Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Apr 29, 2026
Earnings Call Sentiment Positive
The call presented a largely constructive operational and financial picture: revenue held at $1B, adjusted EBITDA beat at $230M, strong free cash flow generation, meaningful progress on deleveraging (65% of term loan repaid) and clear technology/contract wins (FlexRobotics, FlexRig improvements, geothermal awards). Offsetting items were primarily timing and one-time impacts — ~$103M non-cash impairment, reactivation cost lumpiness shifting into Q2 (and a bit into Q3), short-term North America softness and some offshore seasonality. Management kept full-year guidance intact, trimmed CapEx modestly, and emphasized returning rigs to work, margin improvement in later quarters and a path to pay down remaining debt. Overall, positive operational momentum and balance-sheet repair outweigh near-term timing and impairment headwinds, with management confident in margin recovery later in the fiscal year.Q1-2026 Updates
Positive Updates
Strong quarterly financial performance
Revenue of $1.0 billion (third consecutive quarter at $1B) and adjusted EBITDA of $230 million, coming in ahead of expectations; free cash flow of $126 million for the quarter.
Progress on deleveraging and liquidity
Paid down $260 million of the $400 million term loan (65% repaid) as of end of January; cash and short-term investments of ~$269 million and total liquidity (including revolver) of ~ $1.2 billion; target to repay remaining term loan ahead of schedule (mid-2026).
North America operational strength
North America averaged 143 rigs working and delivered North America direct margin of $239 million with average gross margin above $18,000 per day; management emphasized maintaining ~45%-50% direct margin discipline.
International segment outperformance and Saudi reactivations
International Solutions ended the quarter with ~59 rigs and generated approx. $29 million of direct margin, exceeding the guidance range ($13M-$23M) primarily due to timing of reactivation costs and stronger FlexRig utilization; management expects 7 Saudi rig reactivations (2 masts raised to date) with most reactivations completed by mid-2026 and ~$5M annualized EBITDA contribution per reactivated rig.
Offshore Solutions stability
Offshore segment produced approx. $31 million of direct margin, with 3 active rigs and 33 management contracts (management contracts provide durable, capital-light cash flow); full-year offshore direct margin guide retained at $100M-$115M.
Technology and innovation progress (FlexRobotics & FlexRig)
FlexRobotics has been deployed successfully on 3 pads for a Super Major in the Permian, automating drilling/connections; FlexRig fleet showed meaningful margin improvement in Jafurah and management expects continued margin expansion from FlexRigs (historical fleet contribution cited in the $20M-$25M range).
Geothermal and international contract wins
Contract awards for geothermal rigs in Germany, Denmark and the Netherlands during the quarter, plus another North American geothermal rig in January; additional deployments in Australia and Pakistan and ongoing discussions in Middle East/North Africa.
Capital discipline and cost optimization
Q1 CapEx of $68 million (below sequential run rate) and trimmed full-year gross CapEx guidance to $270M-$310M; SG&A reduced by over $50 million relative to pre-acquisition run rates and line-of-sight on ~$100 million of portfolio divestments.
Negative Updates
Non-cash impairment and GAAP loss
Reported net loss of $0.98 per diluted share for the quarter, negatively impacted by ~$103 million of non-cash impairment and unusual non-cash items; adjusted loss excluding those items was ~$0.15 per share.
Timing/lumpiness from Saudi reactivation costs
Reactive start-up costs shifted partly from Q1 into Q2 (management expects the majority to hit Q2 with some tail into Q3), creating sequential margin lumpiness in International Solutions (Q2 direct margin guide $12M-$22M vs Q1 ~$29M).
North America seasonal softness and moderated demand
North America exit rig count declined 4% quarter-over-quarter (exit 139 rigs) and management expects Q2 average rigs of 132-138 (implying a further short-term reduction); activity remained restrained with smaller/private E&Ps more price-sensitive.
Offshore seasonality and contract roll-offs
Q2 offshore margin guidance is lower ($20M-$30M) due to typical seasonality, lower revenue days and roll-off of some higher-margin rig management contracts (e.g., Angola), causing a sequential step-down.
Asset rationalizations and yarded rig impairments
Impairments and decommissioning relate to a large set of older/idle rigs (referenced ~30 rigs/components) that had been offline since COVID or earlier; accounting-driven write-downs reflect cost/benefit of returning these assets to service.
Argentina churn and timing of technology upgrades
Some rigs in Argentina returned to the yard to be fitted with additional technology packages before redeployment, producing temporary churn and lower near-term utilization in that market.
Macro and commodity-driven caution
Management reiterated that oil-related investment is expected to remain soft in the near term as operators prioritize returns over volume, creating an uneven activity backdrop (North America described as the most restrained market near-term).
Company Guidance
Management guided that Q1 FY2026 produced $1.0B revenue, $230M adjusted EBITDA, a net loss of $0.98/sh (‑$0.15/sh excluding $103M of non‑cash items), $68M CapEx, and $126M free cash flow while paying $25M in base dividends; they’ve paid $260M of a $400M term loan (leaving $140M) with cash & short‑term investments ≈$269M and total liquidity ≈$1.2B. Segment detail and near‑term guidance: North America averaged 143 rigs (exit 139) with $239M direct margin and >$18k/day gross margin (Q2 operated rigs guided 132–138 with Q2 direct margin $205–230M; full‑year rig count range 132–148); International ended Q1 with 59 rigs and ≈$29M direct margin (Q2 rigs 57–63, Q2 margin $12–22M) noting 7 Saudi reactivations (expect ≈$5M annualized EBITDA per reactivated rig and FlexRig fleet upside targeted historically at ~$20–25M annualized); Offshore generated ≈$31M direct margin with 3 active rigs/33 management contracts (Q2 margin $20–30M; full‑year offshore guide $100–115M). They trimmed FY2026 gross CapEx to $270–310M, reported SG&A reductions >$50M vs. pre‑merger, have line‑of‑sight on >$100M of divestments, and reiterated the priority of deleveraging toward ~1x net debt/EBITDA while maintaining the base dividend.Helmerich & Payne Financial Statement Overview
Summary
Results have weakened materially: TTM revenue is down 18.1% and the company posted a net loss (-$302.2M; -4.4% margin). Cash flow is a stabilizer (TTM operating cash flow $567.0M and positive/free cash flow $179.6M with +54.0% growth), but higher leverage versus prior years and negative returns reduce financial flexibility.Income Statement
Profitability has deteriorated sharply: TTM (Trailing-Twelve-Months) revenue is down 18.1% and the company posted a net loss (-$302.2M) with a negative net margin (-4.4%). This is a significant step back from 2023–2024 when the business was solidly profitable (2024 net margin ~12.5%, 2023 ~15.1%). A positive offset is that EBITDA remains meaningfully positive in TTM ($456.3M; ~17.6% margin), suggesting core operations still generate earnings power, but the near-term earnings trajectory is clearly weaker and more volatile.38
Negative
Balance Sheet
The balance sheet shows mixed signals. Equity is sizable (~$2.70B) versus assets (~$6.46B), but returns have turned negative in TTM (return on equity ~-5.8%), reflecting the current loss-making period. Leverage appears elevated in the annual period with debt-to-equity around 0.76 (2025 annual) versus much lower levels in 2022–2023 (~0.21–0.22), implying a meaningful increase in balance-sheet risk versus prior years. Overall, the company has a capital base to absorb volatility, but weaker profitability and higher leverage reduce flexibility.30
Negative
Cash Flow
Cash generation is a relative strength despite weaker reported earnings. TTM (Trailing-Twelve-Months) operating cash flow is solid at $567.0M and free cash flow is positive at $179.6M, with strong TTM free-cash-flow growth (+54.0%). That said, cash flow conversion is less consistent across the cycle: operating cash flow relative to near-term obligations is below 1x in the latest periods (~0.67x), and free cash flow has been volatile historically (including negative free cash flow in 2022). Still, positive and improving TTM free cash flow supports liquidity.62
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 3.75B | 2.76B | 2.87B | 2.06B | 1.22B |
| Gross Profit | 553.50M | 729.04M | 775.01M | 229.19M | -153.76M |
| EBITDA | 658.78M | 907.46M | 992.98M | 453.69M | 13.81M |
| Net Income | -165.09M | 344.17M | 434.10M | 6.95M | -326.15M |
Balance Sheet | |||||
| Total Assets | 6.71B | 5.78B | 4.44B | 4.41B | 5.03B |
| Cash, Cash Equivalents and Short-Term Investments | 245.76M | 510.26M | 409.84M | 385.48M | 1.12B |
| Total Debt | 2.32B | 1.86B | 599.95M | 582.34M | 1.08B |
| Total Liabilities | 3.88B | 2.86B | 1.67B | 1.64B | 2.12B |
| Stockholders Equity | 2.72B | 2.92B | 2.77B | 2.77B | 2.91B |
Cash Flow | |||||
| Free Cash Flow | 116.58M | 189.59M | 438.22M | -38.63M | 54.29M |
| Operating Cash Flow | 542.95M | 684.66M | 833.68M | 233.91M | 136.44M |
| Investing Cash Flow | -1.93B | -458.75M | -322.58M | -167.31M | -161.99M |
| Financing Cash Flow | 66.66M | 986.51M | -463.87M | -734.30M | 425.52M |
Helmerich & Payne Technical Analysis
Positive
34.53
Price Trends
30.53
Positive
27.30
Positive
22.28
Positive
Market Momentum
1.41
Negative
62.34
Neutral
81.63
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HP, the sentiment is Positive. The current price of 34.53 is above the 20-day moving average (MA) of 32.91, above the 50-day MA of 30.53, and above the 200-day MA of 22.28, indicating a bullish trend. The MACD of 1.41 indicates Negative momentum. The RSI at 62.34 is Neutral, neither overbought nor oversold. The STOCH value of 81.63 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HP.
Helmerich & Payne Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $999.48M | 6.93 | 47.77% | ― | 6.52% | ― | |
68 Neutral | $2.22B | 7.14 | 17.02% | 3.72% | -20.11% | -26.44% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
65 Neutral | $3.91B | 26.96 | 9.21% | 1.78% | -12.05% | -46.45% | |
58 Neutral | $3.01B | -33.48 | -4.00% | 5.42% | -16.59% | 83.95% | |
54 Neutral | $3.70B | -10.86 | -5.87% | 3.24% | 35.89% | -148.39% |
* Energy Sector Average
HP
Helmerich & Payne
34.53
8.04
30.36%
NBR
Nabors Industries
66.89
12.57
23.14%
PTEN
Patterson-UTI
8.17
0.21
2.64%
TNK
Teekay Tankers
64.42
23.86
58.83%
LBRT
Liberty Oilfield Services
23.72
6.64
38.88%
Helmerich & Payne Corporate Events
Business Operations and StrategyExecutive/Board Changes
Helmerich & Payne Announces CEO Retirement and Successor
Neutral
Dec 11, 2025
On December 10, 2025, Helmerich & Payne, Inc. announced that CEO John Lindsay will retire following the 2026 Annual Meeting of Stockholders, with President Raymond John ‘Trey’ Adams III set to succeed him. Lindsay, who has been pivotal in guiding the company through significant industry cycles and technological advancements, will remain as a senior advisor through December 2026 to ensure a smooth transition. Adams, with a strong background in various leadership roles within the company, is expected to continue focusing on performance, safety, and strategic growth, aiming to maintain H&P’s competitive edge and shareholder value.
The most recent analyst rating on (HP) stock is a Hold with a $33.00 price target. To see the full list of analyst forecasts on Helmerich & Payne stock, see the HP Stock Forecast page.
Dividends
Helmerich & Payne Declares Quarterly Cash Dividend
Positive
Dec 9, 2025
On December 9, 2025, Helmerich & Payne‘s Board of Directors declared a quarterly cash dividend of $0.25 per share, to be paid on February 27, 2026, to shareholders recorded by February 13, 2026. This decision reflects the company’s ongoing commitment to returning value to its shareholders, potentially enhancing its attractiveness to investors and solidifying its position in the market.
The most recent analyst rating on (HP) stock is a Buy with a $33.00 price target. To see the full list of analyst forecasts on Helmerich & Payne stock, see the HP Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.