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PHX Energy Services (TSE:PHX)
TSX:PHX
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PHX Energy Services (PHX) AI Stock Analysis

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TSE:PHX

PHX Energy Services

(TSX:PHX)

Rating:64Neutral
Price Target:
C$8.00
▲(4.71% Upside)
PHX Energy Services has a strong valuation with a low P/E ratio and high dividend yield, making it attractive for value and income investors. However, bearish technical indicators and cash flow management challenges weigh on the overall score.
Positive Factors
Financial Performance
In Canada, revenue increased 7% year-over-year to $46 million, a Q4 high for the segment since 2014.
Revenue Growth
U.S. Revenue of $132 million was up ~13% quarter over quarter, delivering the strongest Q4 in PHX's history.
Shareholder Returns
The company plans to return ~70% of excess free cash flow to shareholders, which represents one of the highest levels in the coverage group.
Negative Factors
Valuation
Given its differentiated technology offering, solid market share, strong dividend yield, and inexpensive valuation, the shares are deserving.

PHX Energy Services (PHX) vs. iShares MSCI Canada ETF (EWC)

PHX Energy Services Business Overview & Revenue Model

Company DescriptionPHX 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 MoneyPHX 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
75
Positive
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
70
Positive
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
60
Neutral
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.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue700.68M659.66M656.34M535.74M349.92M233.73M
Gross Profit124.16M124.49M150.10M109.64M71.65M32.04M
EBITDA123.90M123.05M150.08M72.88M58.69M26.97M
Net Income52.94M54.62M98.58M44.31M22.72M-6.88M
Balance Sheet
Total Assets429.88M423.29M385.49M375.22M262.49M216.54M
Cash, Cash Equivalents and Short-Term Investments10.70M14.16M16.43M18.25M24.83M25.75M
Total Debt74.70M52.18M44.77M62.41M35.87M39.10M
Total Liabilities208.04M201.08M175.53M198.35M128.06M84.51M
Stockholders Equity221.84M222.21M209.97M176.88M134.43M132.03M
Cash Flow
Free Cash Flow-12.25M11.39M31.11M-37.70M8.27M42.23M
Operating Cash Flow67.82M96.90M96.72M37.08M45.43M67.91M
Investing Cash Flow-45.06M-49.16M-20.26M-47.39M-23.63M-19.10M
Financing Cash Flow-25.99M-51.11M-77.95M2.71M-22.72M-33.65M

PHX Energy Services Technical Analysis

Technical Analysis Sentiment
Negative
Last Price7.64
Price Trends
50DMA
7.98
Negative
100DMA
7.91
Negative
200DMA
8.30
Negative
Market Momentum
MACD
-0.10
Negative
RSI
41.21
Neutral
STOCH
22.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PHX, the sentiment is Negative. The current price of 7.64 is above the 20-day moving average (MA) of 7.63, below the 50-day MA of 7.98, and below the 200-day MA of 8.30, indicating a bearish trend. The MACD of -0.10 indicates Negative momentum. The RSI at 41.21 is Neutral, neither overbought nor oversold. The STOCH value of 22.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:PHX.

PHX Energy Services Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
73
Outperform
C$168.32M4.5517.64%-10.64%55.18%
72
Outperform
C$80.48M3.7112.72%19.58%344.29%
66
Neutral
$15.26B7.303.22%5.27%4.16%-60.82%
64
Neutral
C$348.35M6.6423.75%10.60%6.97%-36.60%
54
Neutral
C$71.41M-1.99%5.00%22.76%
52
Neutral
C$290.31M29.361.53%-4.63%-92.13%
52
Neutral
C$400.83M14.37-2.86%-1.65%-279.49%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:PHX
PHX Energy Services
7.55
-0.86
-10.23%
TSE:AKT.A
AKITA Drilling Ltd
1.98
0.67
51.15%
TSE:ACX
Cathedral Energy Services
4.82
-1.01
-17.32%
TSE:CFW
Calfrac Well Services
3.39
-0.46
-11.95%
TSE:ESI
Ensign Energy Services
2.17
-0.24
-9.96%
TSE:WRG
Western Energy Services
2.11
-0.87
-29.19%

PHX Energy Services Corporate Events

Stock BuybackDividendsBusiness Operations and StrategyFinancial Disclosures
PHX Energy Services Achieves Record Second-Quarter Revenue Amidst Operational Challenges
Neutral
Aug 5, 2025

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.

Dividends
PHX Energy Services Declares Quarterly Dividend
Positive
Jun 13, 2025

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.

Executive/Board ChangesShareholder Meetings
PHX Energy Announces Successful Election of Directors at Annual Meeting
Positive
May 8, 2025

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.

DividendsBusiness Operations and StrategyFinancial Disclosures
PHX Energy Services Achieves Record Revenue and Strong Profitability in Q1 2025
Positive
May 6, 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.

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.Date of analysis: Aug 20, 2025