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NOV (NOV)
NYSE:NOV
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NOV
(NYSE:NOV)
Rating:71Outperform
Price Target:
$14.00
â–²(12.81% Upside)
Positive Factors
Aftermarket Demand
Aftermarket demand rebounded from a muted 1Q, with sequential improvements across wellbore and completion tools.
Cost Savings
Management reiterated over $100MM in cost savings by year-end 2026.
Free Cash Flow Conversion
FCF conversion could eclipse 50% this year and be ~60% yielding ~$650mm of FCF, above consensus at $570mm.
Negative Factors
Offshore Project Delays
Offshore project timing continues to drift right, limiting near-term catalysts.
Order Intake
Order intake was softer this quarter as offshore and international awards were deferred.
Tariff Headwinds
Tariff headwinds were $11MM in 2Q with impacts now guided to increase in 3Q and 4Q.
NOV (NOV) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.60B
Dividend Yield4.18%
Average Volume (3M)3.86M
Price to Earnings (P/E)10.2
Beta (1Y)0.79
Revenue Growth-1.21%
EPS Growth-54.44%
CountryUS
Employees34,010
SectorEnergy
Sector Strength49
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)0.34
Shares Outstanding371,364,750
10 Day Avg. Volume3,068,424
30 Day Avg. Volume3,860,533
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.31
Enterprise Value/Revenue0.68
Enterprise Value/Gross Profit3.24
Enterprise Value/Ebitda5.74
Forecast
1Y Price Target
$14.82Price Target Upside19.42% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
NOV Business Overview & Revenue Model
Company DescriptionNOV Inc. (formerly National Oilwell Varco) is a leading global provider of equipment and technology for the oil and gas industry, as well as for other energy sectors. The company operates through multiple segments, including Rig Technologies, Wellbore Technologies, Completion & Production Solutions, and Distribution & Transmission. NOV offers a wide range of products and services, including drilling rigs, wellbore construction services, completion technologies, and aftermarket support, catering to both onshore and offshore operations.
How the Company Makes MoneyNOV generates revenue primarily through the sale of its equipment and technology products to oil and gas operators, as well as through the provision of services across the drilling and production lifecycle. Key revenue streams include the manufacturing and sale of drilling rigs, completion systems, and wellbore technologies, alongside service contracts for maintenance and support. The company also benefits from aftermarket sales, providing spare parts and services that are essential for operational efficiency. Additionally, NOV has strategic partnerships with major oilfield service companies and operators, enhancing its market reach and creating opportunities for joint ventures that contribute to its earnings.
NOV Earnings Call Summary
Earnings Call Date:Jul 29, 2025
(Q2-2025)
| % Change Since: -4.76%|
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Neutral
The call highlighted strong cash flow generation, record revenues in specific segments, and consistent margin growth in the Energy Equipment segment. However, these positives were offset by declines in aftermarket sales, tariff and inflation challenges, and decreased demand in key markets. The sentiment is mixed, with achievements counterbalanced by significant challenges.Q2-2025 Updates
Positive Updates
Strong Free Cash Flow
NOV generated free cash flow of $108 million in the second quarter, converting 83% of EBITDA to free cash flow over the last 12 months, resulting in a total of over $1.2 billion in free cash flow during the last 5 quarters.
Record Revenues in Subsea Flexible Pipe and Process Systems
Second quarter revenue in the Subsea Flexible Pipe business reached an all-time high, and Process Systems also achieved record high revenues, showing significant year-over-year growth.
Consistent Margin Growth in Energy Equipment Segment
The Energy Equipment segment delivered its 12th straight quarter of year-over-year margin expansion, with EBITDA increasing $16 million to $158 million and a 130-basis point increase in EBITDA margins.
Strategic Share Repurchases and Dividends
NOV repurchased 10.9 million shares for $150 million and paid dividends totaling $135 million in the first half of 2025, returning $602 million to shareholders while increasing the cash balance by $612 million since March 2024.
Negative Updates
Decline in Aftermarket Sales
Aftermarket sales and services fell sharply, contributing to an unfavorable sales mix and pressuring margins, with customers reducing spending due to global trade uncertainty and lower oil prices.
Impact of Tariffs and Inflation
Tariff expenses rose to approximately $11 million in Q2, with expectations to increase to $25 million to $30 million by Q4 due to raised steel tariffs and inflation-driven cost pressures.
Challenges in North American and International Markets
The 6% sequential decline in global drilling activity, including a 9% drop in the U.S. oil-directed rig count and decreased activity in Saudi Arabia and Argentina, negatively impacted revenue and margins.
Lower Demand for Quick-Turn Consumables
Diminished demand for quick-turn consumable drilling and completion products in North America, Saudi Arabia, and Latin America contributed to compressed segment margins.
Company Guidance
In the second quarter of 2025, NOV reported revenues of $2.2 billion, a 4% increase from the first quarter of 2025 and a 1% decrease from the second quarter of 2024. The company's net income was $108 million, translating to $0.29 per fully diluted share, with adjusted EBITDA reaching $252 million or 11.5% of sales. The Energy Equipment segment saw a 5% sequential revenue growth due to strong capital equipment sales, despite a significant reduction in demand for aftermarket parts and services. Meanwhile, the Energy Products and Services segment achieved a 3% sequential revenue increase, outperforming a 6% decline in global drilling activity. However, the segment faced margin compression due to lower demand for consumable products in North America and other regions, as well as tariff-related and inflationary pressures. Looking ahead, NOV forecasts a year-over-year consolidated revenue decline of 1% to 3% for the third quarter, with adjusted EBITDA expected to be between $230 million and $250 million. The company remains optimistic about future opportunities in offshore activities and the growing demand for LNG and unconventional gas solutions, supported by its strong balance sheet and significant backlog.NOV Financial Statement Overview
Summary
NOV demonstrates a strong financial position with significant improvements in revenue growth, profitability, and cash flow generation. The company has managed its leverage well, maintaining a healthy balance sheet. While there are some fluctuations in past years, the current trajectory indicates a positive outlook with robust operating performance and effective financial management.Income Statement
The income statement shows a strong recovery with a consistent increase in total revenue over the years. Gross Profit Margin for TTM is approximately 24.15%, indicating robust cost management. The Net Profit Margin improved significantly from negative values in 2020 to 6.68% in TTM, reflecting improved profitability. EBIT and EBITDA margins are healthy at 11.31% and 12.96% respectively, suggesting effective operational efficiency.75
Positive
Balance Sheet
The balance sheet is solid with a Debt-to-Equity Ratio of 0.37, showing manageable leverage levels. The Return on Equity (ROE) for TTM is 9.07%, which is a positive indicator of profitability relative to equity. The Equity Ratio is stable at 57.61%, indicating a strong equity base relative to total assets.70
Positive
Cash Flow
Cash flow statements indicate strong free cash flow generation with a Free Cash Flow to Net Income Ratio of 1.95 in TTM, showing efficient cash management. The Operating Cash Flow to Net Income Ratio is 2.58, highlighting strong cash generation from operations. Free Cash Flow has grown significantly compared to previous years.80
Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 8.87B | 8.58B | 7.24B | 5.52B | 6.09B |
| Gross Profit | 2.01B | 1.83B | 1.33B | 774.00M | 434.00M |
| EBITDA | 1.26B | 1.00B | 617.00M | 153.00M | -2.34B |
| Net Income | 635.00M | 993.00M | 155.00M | -245.00M | -2.54B |
Balance Sheet | |||||
| Total Assets | 11.36B | 11.29B | 10.13B | 9.55B | 9.93B |
| Cash, Cash Equivalents and Short-Term Investments | 1.23B | 816.00M | 1.07B | 1.59B | 1.69B |
| Total Debt | 2.39B | 2.38B | 2.37B | 2.39B | 2.56B |
| Total Liabilities | 4.93B | 5.05B | 5.00B | 4.49B | 4.65B |
| Stockholders Equity | 6.38B | 6.17B | 5.13B | 5.06B | 5.28B |
Cash Flow | |||||
| Free Cash Flow | 953.00M | -140.00M | -393.00M | 90.00M | 700.00M |
| Operating Cash Flow | 1.30B | 143.00M | -179.00M | 291.00M | 926.00M |
| Investing Cash Flow | -471.00M | -293.00M | -238.00M | -196.00M | -144.00M |
| Financing Cash Flow | -406.00M | -103.00M | -96.00M | -189.00M | -259.00M |
NOV Technical Analysis
Negative
12.41
Price Trends
12.91
Negative
12.56
Negative
13.65
Negative
Market Momentum
-0.18
Negative
48.00
Neutral
61.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NOV, the sentiment is Negative. The current price of 12.41 is below the 20-day moving average (MA) of 12.45, below the 50-day MA of 12.91, and below the 200-day MA of 13.65, indicating a bearish trend. The MACD of -0.18 indicates Negative momentum. The RSI at 48.00 is Neutral, neither overbought nor oversold. The STOCH value of 61.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NOV.
NOV Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $14.32B | 16.49 | 29.27% | 0.58% | 12.15% | 91.88% | |
75 Outperform | $50.04B | 11.42 | 19.78% | 3.36% | 0.94% | -4.63% | |
74 Outperform | $42.34B | 14.05 | 18.32% | 2.10% | 2.13% | 54.69% | |
71 Outperform | $4.60B | 10.18 | 7.31% | 4.18% | -1.21% | -54.44% | |
71 Outperform | $18.00B | 9.88 | 18.16% | 3.22% | -4.08% | -29.26% | |
65 Neutral | $14.81B | 7.14 | 3.01% | 5.53% | 4.29% | -62.49% |
* Energy Sector Average
Performance Comparison
NOV
NOV
12.41
-4.40
-26.17%
BKR
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FTI
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35.31
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HAL
Halliburton
21.28
-9.06
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SLB
Schlumberger
33.81
-9.08
-21.17%
NOV Corporate Events
Executive/Board ChangesShareholder MeetingsDividends
NOV Declares Dividends at Annual Stockholders Meeting
Positive
May 22, 2025
On May 20, 2025, NOV Inc. held its Annual Meeting of Stockholders where key decisions were made, including the re-election of nine board members, the ratification of Ernst & Young LLP as auditors for 2025, approval of executive compensation, and amendments to the Long-Term Incentive Plan. Additionally, the Board declared a supplemental dividend of $0.21 per share and a regular quarterly dividend of $0.075 per share, reflecting the company’s commitment to returning capital to shareholders.
The most recent analyst rating on (NOV) stock is a Buy with a $22.00 price target. To see the full list of analyst forecasts on NOV stock, see the NOV 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.