Precision Drilling (PD) AI Stock Analysis

• Market Cap: C$1.53B
• Dividend Yield: N/A
• Average Volume (3M): 91.36K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.29
• Revenue Growth: -5.55%
• EPS Growth: -74.96%
• Country: CA
• Employees: 5,504
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Drilling
• EPS (TTM): -3.23
• Shares Outstanding: 12,932,399
• 10 Day Avg. Volume: 77,860
• 30 Day Avg. Volume: 91,365
• PEG Ratio: -7.26
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.71
• P/FCF Ratio: 8.83
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$137.28
• Price Target Upside: 16.02% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 7.59
• Revenue Forecast (FY): C$1.90B

• Rating: 67 Neutral
• Price Target: C$129.00 ▲(9.03% Upside)
• Action: Downgraded Date: 02/18/26
• Date: Action: Downgraded 02/18/26

The score is supported by strong technical momentum and improved financial health (better profitability and lower leverage versus prior years). Offsetting this are inconsistent bottom-line results (near break-even net income in 2025) and weak/unclear valuation signals due to a highly negative P/E and no dividend yield data.

Positive Factors

Improved Leverage & Liquidity

Material debt reduction and stronger liquidity raise financial flexibility over the medium term. Lower leverage reduces interest burden and increases capacity to fund rig upgrades, buybacks and absorb downturns, supporting durable capital allocation and resilience across cycles.

Consistent Operating Cash Generation

Sustained operating cash flow demonstrates underlying cash-generating ability independent of accounting earnings. This durable cash conversion supports reinvestment in high-spec rigs, debt paydown and shareholder returns, giving the company structural financial flexibility despite cyclicality.

Technology-Led Fleet Upgrades & U.S. Growth

Investment in proprietary tech and targeted rig upgrades raises service differentiation and efficiency. A higher-spec fleet can command better day rates and utilization, while rising U.S. rig count in gas basins signals structural demand that supports durable margin improvement and competitive positioning.

Negative Factors

Revenue Volatility

Material top-line swings reflect the business’s exposure to commodity cycles and project timing. Revenue volatility reduces predictability of utilization and cash flow, complicates capital planning, and can compress margins during softer periods, limiting steady long-term earnings growth.

Weak Reported Net Income Conversion

A gap between robust operating metrics and near-zero net income indicates vulnerability to below-the-line items (taxes, interest, one-offs). This undermines the translation of operational strength into shareholder earnings and may limit sustainable reinvestment and dividend/buyback capacity.

Canadian Activity Decline & Contract Churn

Persistent declines and contract churn in Canada, a core market, weaken utilization and pricing power. Reduced activity there can persist through seasonal and project deferrals, pressuring dayrates and making revenue and margin recovery slower even if other regional demand improves.

Precision Drilling Business Overview & Revenue Model

Company Description

Precision Drilling Corporation, a drilling company, provides onshore drilling, completion, and production services to exploration and production companies in the oil and natural gas and geothermal industries in North America and the Middle East. The company operates in two segments, Contract Drilling Services; and Completion and Production Services. The Contract Drilling Services segment offers onshore well drilling services to exploration and production companies in the oil and natural gas industry. This segment's services include land and turnkey drilling; and procurement and distribution of oilfield supplies, as well as manufacture and refurbishment of drilling and service rig equipment. As of December 31, 2021, it operated 227 land drilling rigs, including 109 in Canada; 105 in the United States; 6 in Kuwait; 4 in Saudi Arabia; 2 in the Kurdistan region of Iraq; and 1 in the country of Georgia. As of December 31, 2021, this segment also operated 47 AlphaTM rigs with commercial AlphaAutomation; 18 AlphaApps; 4 grid power capable rigs; and 60 natural gas or bi-fuel rigs. The Completion and Production Services segment provides service rigs for well completion, workover, abandonment, maintenance, and re-entry preparation services; wellsite accommodations; oilfield surface equipment rentals; and camp and catering services to oil and natural gas exploration and production companies. As of December 31, 2021, it operated 123 well completion and workover service rigs, including 113 in Canada and 10 in the United States; 1,900 oilfield rental items, including surface storage, small-flow wastewater treatment, power generation, and solids control equipment; 109 wellsite accommodation units; 943 drill camp beds; 822 base camp beds; and three kitchen diners in Canada. Precision Drilling Corporation was incorporated in 1951 and is headquartered in Calgary, Canada.

How the Company Makes Money

Precision Drilling generates revenue primarily through its contract drilling services, where it charges clients for the use of its drilling rigs and associated services. The company operates on a dayrate model, whereby clients pay a fixed rate for each day the rig is utilized. Additional revenue streams include directional drilling services, which involve advanced drilling techniques to enhance efficiency and reduce costs for clients, and well servicing operations that provide maintenance and repair services for oil and gas wells. Strategic partnerships with major oil and gas companies enhance its market reach and reliability, while the company's investment in technology and innovations allows it to offer high-value services that attract clients and drive earnings.

Precision Drilling Financial Statement Overview

Summary

Operating profitability and leverage have improved versus 2020–2022, with consistently positive operating cash flow and generally positive free cash flow. However, results remain cyclical and variable, and 2025 net income fell to near break-even despite healthy operating metrics, raising concerns about bottom-line consistency.

Income Statement

Revenue has been volatile: strong growth in 2022 and 2025, but flat-to-down in 2024. Profitability improved materially from deep losses in 2020–2022 to solid operating margins in 2023–2025, with EBITDA margins remaining healthy; however, net income deteriorated sharply in 2025 to near break-even despite decent EBIT, signaling heavier below-the-line costs and/or one-time items. Overall, the core earnings profile looks stronger than a few years ago, but reported bottom-line consistency is a key weakness.

Balance Sheet

Leverage has improved meaningfully versus 2020–2022, with debt-to-equity stepping down from roughly ~0.9–1.0x to ~0.5x in 2024–2025 and total debt trending lower. Equity is sizable and relatively stable, supporting financial flexibility. The main watch-out is that the business remains cyclical, and returns on equity have swung from negative (2020–2022) to strong (2023) and then more modest (2024), indicating performance can change quickly with industry conditions.

Cash Flow

Operating cash flow has been consistently positive and improved substantially versus 2021–2022, and it covered net income by more than 1x in 2023–2025, which supports earnings quality. Free cash flow is positive across recent years, but it has been choppy and declined meaningfully in 2025 (and was modest in 2022), suggesting higher reinvestment needs and/or working-capital swings. In short: solid cash generation, but free-cash-flow stability is not yet dependable.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.84B	1.90B	1.94B	1.62B	986.85M
Gross Profit	286.15M	1.59B	733.31M	213.56M	6.38M
EBITDA	489.62M	535.85M	657.73M	311.61M	191.19M
Net Income	1.84M	111.19M	289.24M	-34.29M	-177.39M
Balance Sheet
Total Assets	2.73B	2.96B	3.02B	2.88B	2.66B
Cash, Cash Equivalents and Short-Term Investments	85.78M	73.77M	54.18M	21.59M	40.59M
Total Debt	791.41M	887.59M	992.19M	1.15B	1.17B
Total Liabilities	1.14B	1.27B	1.44B	1.65B	1.44B
Stockholders Equity	1.58B	1.68B	1.58B	1.23B	1.23B
Cash Flow
Free Cash Flow	148.71M	265.38M	273.82M	52.85M	63.28M
Operating Cash Flow	412.18M	482.08M	500.57M	237.10M	139.22M
Investing Cash Flow	-208.32M	-202.99M	-214.78M	-144.41M	-56.61M
Financing Cash Flow	-191.56M	-261.38M	-251.97M	-113.17M	-149.91M

Precision Drilling Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 118.32
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PD, the sentiment is Positive. The current price of 118.32 is above the 20-day moving average (MA) of 117.41, above the 50-day MA of 107.24, and above the 200-day MA of 83.57, indicating a bullish trend. The MACD of 3.62 indicates Positive momentum. The RSI at 57.93 is Neutral, neither overbought nor oversold. The STOCH value of 34.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:PD.

Precision Drilling Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AKT.A	73 Outperform	C$93.68M	4.34	12.87%	―	24.94%	956.65%
ACX	72 Outperform	C$224.20M	8.12	11.51%	―	-16.20%	-38.85%
PHX	69 Neutral	C$546.72M	9.99	23.65%	10.44%	8.98%	-27.41%
PD	67 Neutral	C$1.53B	-16,902.86	0.06%	―	-5.55%	-74.96%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
ESI	56 Neutral	C$669.28M	-14.41	-3.50%	―	-2.47%	-246.73%
WRG	55 Neutral	C$85.28M	-3.28	-2.38%	―	-0.38%	6.98%

Precision Drilling Corporate Events

Precision Drilling Hits 2025 Debt Target, Boosts Buybacks Amid Strong Rig Demand

Precision Drilling announced it met its 2025 capital allocation objectives, including reducing debt by $101 million, ending the year with approximately $85 million in cash and $447 million in total available liquidity, and returning $76 million to shareholders through share repurchases that cut its share count by 6%. The company highlighted progress toward its longer-term goal of repaying $700 million of debt between 2022 and 2027 and lowering its Net Debt to Adjusted EBITDA ratio below 1.0 times, noting that it has already reduced debt by $535 million over four years and significantly lowered annual interest expense, with plans to further deleverage and increase buybacks in 2026. Operationally, Precision reported strong demand in Canada for its Super Series rigs and technology and environmental offerings, with high winter utilization, while U.S. activity remained steady amid a recovering natural gas rig market; the company also moved to streamline its fleet by decommissioning 31 underutilized rigs and recording non-cash asset charges tied to aging equipment, signaling an ongoing shift toward more advanced, higher-margin drilling assets.

The most recent analyst rating on (TSE:PD) stock is a Buy with a C$81.00 price target. To see the full list of analyst forecasts on Precision Drilling stock, see the TSE:PD Stock Forecast page.

Precision Drilling Sets February Date for 2025 Year-End Results Call

Precision Drilling Corporation will release its fourth-quarter and full-year 2025 financial results after markets close on February 11, 2026, followed by a conference call and webcast on February 12 to discuss the performance. The scheduled call, which requires advance registration for dial-in details and will also be available via webcast replay on the company’s website, underscores Precision’s ongoing engagement with investors and other stakeholders as it reports on its operational and financial trajectory in a changing energy services market.

The most recent analyst rating on (TSE:PD) stock is a Buy with a C$81.00 price target. To see the full list of analyst forecasts on Precision Drilling stock, see the TSE:PD Stock Forecast page.