PHX Energy Services (PHX) AI Stock Analysis

• Market Cap: C$351.96M
• Dividend Yield: 10.01%
• Average Volume (3M): 138.05K
• Price to Earnings (P/E): 6.7
• Beta (1Y): 0.98
• Revenue Growth: 6.97%
• EPS Growth: -36.60%
• Country: CA
• Employees: 924
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Drilling
• EPS (TTM): 0.17
• Shares Outstanding: 45,181,072
• 10 Day Avg. Volume: 150,613
• 30 Day Avg. Volume: 138,047
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$10.00
• Price Target Upside: 26.42% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 70 Outperform
• Price Target: C$8.50 ▲(7.46% Upside)

PHX Energy Services scores well due to its strong valuation metrics, with a low P/E ratio and high dividend yield, suggesting it may be undervalued. Financial performance is solid, but cash flow challenges need addressing. Technical indicators show limited momentum, which slightly tempers the overall score.

Positive Factors

Revenue Growth

Consistent revenue growth indicates a stable demand for PHX Energy's services, suggesting a strong market position and potential for future expansion.

Balance Sheet Health

A low debt-to-equity ratio reflects prudent financial management, providing PHX Energy with flexibility to invest in growth opportunities without excessive financial risk.

Profitability

Improved net profit margins highlight PHX Energy's ability to manage costs effectively and enhance profitability, supporting long-term financial health.

Negative Factors

Cash Flow Challenges

Negative free cash flow growth indicates potential liquidity issues, limiting PHX Energy's ability to fund operations and invest in future growth without external financing.

Cost Management Pressure

A decrease in gross profit margin suggests rising costs or pricing pressures, which could impact profitability if not managed effectively over time.

Earnings Volatility

A significant decline in EPS growth reflects earnings volatility, which may affect investor confidence and the company's ability to sustain long-term growth.

PHX Energy Services Business Overview & Revenue Model

Company Description

PHX Energy Services Corp. provides horizontal and directional drilling technology and services to oil and natural gas exploration and development, and production companies in Canada, the United States, Russia, Albania, and the Middle East. It offers Velocity Real-Time System, a ground-breaking technology that offers downhole guidance systems; Atlas Motors, a high-performance drilling motors; PowerDrive Orbit RSS, a rotary steerable system; P-360 Positive Pulse MWD System, a measurement while drilling (MWD) tool; and E-360 EM MWD System, an MWD tool that transmits electric signals through geological formations. The company also provides 360 CV MWD System, a clear vision tool, which surveys inclination and gamma in real-time closer to the bit; 360 RWD System, a resistivity while drilling sub; and North Seeking Gyro that offers real-time QA/QC checks downhole, as well as performance drilling motors. In addition, it provides survey management, gyro surveying, and directional drilling and motor rentals. The company was formerly known as Phoenix Technology Income Fund and changed its name to PHX Energy Services Corp. PHX Energy Services Corp. was founded in 1995 and is headquartered in Calgary, Canada.

How the Company Makes Money

PHX Energy Services generates revenue primarily through the provision of directional and horizontal drilling services to oil and gas companies. The company's key revenue streams include service fees charged for its drilling technology solutions, rental fees for drilling equipment, and sales of related products. PHX Energy leverages its expertise and proprietary technologies to offer value-added services, which enable clients to extract resources more effectively and efficiently. Additionally, the company may engage in strategic partnerships or alliances with other industry players to expand its service offerings and market reach. The company's earnings are influenced by factors such as oil and gas market conditions, technological advancements, and customer demand for efficient drilling solutions.

PHX Energy Services Financial Statement Overview

Summary

PHX Energy Services shows strong revenue growth and profitability with stable margins and a solid balance sheet. However, challenges in cash flow management, such as a negative free cash flow growth rate, could impact future investments and financial flexibility.

Income Statement

PHX Energy Services has shown consistent revenue growth, with a TTM revenue growth rate of 1.96% and a strong historical growth trajectory. The gross profit margin has slightly decreased in the TTM period to 18.58% from 18.87% in the previous year, indicating some pressure on cost management. However, the net profit margin has improved to 8.34% in the TTM, reflecting better profitability. EBIT and EBITDA margins are stable, suggesting efficient operations.

Balance Sheet

The company's debt-to-equity ratio is relatively low at 0.26, indicating a conservative leverage position. Return on equity is strong at 25.77%, showcasing effective use of equity to generate profits. The equity ratio stands at 51.61%, reflecting a solid equity base relative to total assets. Overall, the balance sheet is stable with manageable debt levels.

Cash Flow

PHX Energy Services faces challenges in cash flow management, with a negative free cash flow growth rate of -198.37% in the TTM. The operating cash flow to net income ratio is 0.70, indicating that operating cash flow is not fully covering net income. The free cash flow to net income ratio is low at 0.13, suggesting limited cash flow available after capital expenditures.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	700.68M	659.66M	656.34M	535.74M	349.92M	233.73M
Gross Profit	124.16M	124.49M	150.10M	109.64M	71.65M	32.04M
EBITDA	123.90M	123.05M	150.08M	72.88M	58.69M	26.97M
Net Income	52.94M	54.62M	98.58M	44.31M	22.72M	-6.88M
Balance Sheet
Total Assets	429.88M	423.29M	385.49M	375.22M	262.49M	216.54M
Cash, Cash Equivalents and Short-Term Investments	10.70M	14.16M	16.43M	18.25M	24.83M	25.75M
Total Debt	74.70M	52.18M	44.77M	62.41M	35.87M	39.10M
Total Liabilities	208.04M	201.08M	175.53M	198.35M	128.06M	84.51M
Stockholders Equity	221.84M	222.21M	209.97M	176.88M	134.43M	132.03M
Cash Flow
Free Cash Flow	-12.25M	11.39M	31.11M	-37.70M	8.27M	42.23M
Operating Cash Flow	67.82M	96.90M	96.72M	37.08M	45.43M	67.91M
Investing Cash Flow	-45.06M	-49.16M	-20.26M	-47.39M	-23.63M	-19.10M
Financing Cash Flow	-25.99M	-51.11M	-77.95M	2.71M	-22.72M	-33.65M

PHX Energy Services Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 7.91
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PHX, the sentiment is Neutral. The current price of 7.91 is above the 20-day moving average (MA) of 7.65, above the 50-day MA of 7.83, and below the 200-day MA of 8.21, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 59.64 is Neutral, neither overbought nor oversold. The STOCH value of 81.04 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:PHX.

PHX Energy Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AKT.A	74 Outperform	80.48M	3.69	11.96%	―	19.58%	344.29%
PHX	70 Outperform	C$351.96M	6.71	23.75%	10.01%	6.97%	-36.60%
ACX	70 Neutral	160.80M	4.44	16.38%	―	-10.64%	55.18%
ESI	53 Neutral	458.11M	-11.82	-2.89%	―	-1.65%	-279.49%
CFW	52 Neutral	294.60M	30.05	1.50%	―	-4.63%	-92.13%
WRG	49 Neutral	77.16M	-12.62	-2.02%	―	5.00%	22.76%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%

PHX Energy Services Corporate Events

PHX Energy Services Achieves Record Second-Quarter Revenue Amidst Operational Challenges

PHX Energy Services reported a record second-quarter revenue of $167.7 million for 2025, marking a 9% increase from the previous year. Despite the revenue growth, the company faced challenges with a 9% decrease in adjusted EBITDA due to higher equipment costs and inventory obsolescence. The US division saw a 10% revenue increase, while the Canadian division achieved a 4% revenue rise despite a decline in industry drilling days. The company also declared a dividend and engaged in share repurchases, indicating a commitment to rewarding shareholders.

The most recent analyst rating on (TSE:PHX) stock is a Buy with a C$12.00 price target. To see the full list of analyst forecasts on PHX Energy Services stock, see the TSE:PHX Stock Forecast page.

PHX Energy Services Declares Quarterly Dividend

PHX Energy Services Corp. has announced a quarterly cash dividend of $0.20 per common share, payable on July 15, 2025, to shareholders of record as of June 30, 2025. This announcement underscores the company’s financial health and commitment to delivering shareholder value, reinforcing its position in the oil and natural gas services industry.

The most recent analyst rating on (TSE:PHX) stock is a Buy with a C$12.00 price target. To see the full list of analyst forecasts on PHX Energy Services stock, see the TSE:PHX Stock Forecast page.

PHX Energy Announces Successful Election of Directors at Annual Meeting

PHX Energy Services Corp. announced the successful election of seven directors at its annual shareholders’ meeting on May 7, 2025. The election results reflect strong shareholder support for the nominees, which is indicative of confidence in the company’s strategic direction and leadership. This development is likely to reinforce PHX Energy’s market position as a leader in drilling technology and services, potentially benefiting stakeholders through sustained growth and innovation.

PHX Energy Services Achieves Record Revenue and Strong Profitability in Q1 2025

PHX Energy Services reported record revenue of $193.7 million for the first quarter of 2025, marking a 17% increase from the previous year. The company’s profitability was driven by growth in high-margin RSS and motor rental revenue streams, particularly in the US and Canada. The US division achieved a record quarterly revenue of $136.1 million, while the Canadian division reported its highest quarterly revenue since 2014. The company declared a dividend of $0.20 per share and announced a $10 million increase in its capital expenditure budget, aiming to expand its RSS fleet and Real Time RSS Communications technology.