Select Energy Services (WTTR) AI Stock Analysis

• Market Cap: $1.30B
• Dividend Yield: 2.61%
• Average Volume (3M): 1.37M
• Price to Earnings (P/E): 55.2
• Beta (1Y): 1.35
• Revenue Growth: -4.60%
• EPS Growth: -67.28%
• Country: US
• Employees: 3,700
• Sector: Energy
• Sector Strength: 52
• Industry: Regulated Water
• EPS (TTM): 0.03
• Shares Outstanding: 104,908,610
• 10 Day Avg. Volume: 1,385,851
• 30 Day Avg. Volume: 1,370,858
• PEG Ratio: -0.76
• Price to Book (P/B): 1.67
• Price to Sales (P/S): 0.91
• P/FCF Ratio: 21.44
• Enterprise Value/Market Cap: 0.98
• Enterprise Value/Revenue: 0.90
• Enterprise Value/Gross Profit: 5.20
• Enterprise Value/Ebitda: 5.90
• 1Y Price Target: $15.00
• Price Target Upside: 34.29% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 62 Neutral
• Price Target: $10.50 ▼(-6.00% Downside)

Select Energy Services' overall stock score reflects a mixed financial performance with operational efficiency but challenges in revenue growth and cash flow management. The technical analysis suggests potential short-term weakness, while the valuation indicates overvaluation. However, the positive sentiment from the earnings call, driven by strategic advancements and strong cash flow management, provides a more optimistic outlook.

Positive Factors

Long-term Contracts

Long-term contracts provide revenue stability and predictability, enhancing financial planning and operational efficiency.

Chemical Technologies Growth

Growth in Chemical Technologies indicates successful product innovation and market share expansion, supporting future revenue growth.

Mineral Extraction Initiative

The lithium extraction initiative diversifies revenue streams and taps into the growing demand for lithium, enhancing long-term growth prospects.

Negative Factors

Decline in Water Services Revenue

A decline in Water Services revenue due to divestments and lower customer activity could impact overall revenue stability and growth.

Decreased Water Infrastructure Revenue

Decreased revenue in Water Infrastructure suggests potential vulnerabilities to oil price fluctuations, affecting segment profitability.

Increased SG&A Costs

Rising SG&A costs can strain profitability and indicate challenges in cost management, potentially impacting future earnings.

Select Energy Services Business Overview & Revenue Model

Company Description

Select Energy Services (WTTR) is a leading provider of water solutions for the oil and gas industry, specializing in water sourcing, transportation, treatment, and disposal. The company operates primarily in the upstream sector and offers a comprehensive suite of services that support exploration and production activities. Select Energy Services is committed to providing environmentally responsible water management solutions that enhance operational efficiency while minimizing environmental impact.

How the Company Makes Money

Select Energy Services generates revenue through multiple key streams, primarily by offering water management services to oil and gas exploration and production companies. Their revenue model includes charging fees for water sourcing, transportation, and disposal services. Additionally, the company earns income from water treatment services, which involve the purification and recycling of produced water. Significant partnerships with major oil and gas operators enhance their service capabilities and market reach, contributing substantially to their earnings. The cyclical nature of the oil and gas industry also influences their financial performance, with revenues typically increasing in periods of high drilling activity and decreasing during downturns.

Select Energy Services Financial Statement Overview

Summary

Select Energy Services exhibits a mixed financial performance. While the company shows operational efficiency and a stable balance sheet, challenges remain in revenue growth and cash flow management. The company should focus on reversing the negative revenue trend and improving cash flow to enhance overall financial health.

Income Statement

Select Energy Services has shown a mixed performance in its income statement. The TTM data indicates a slight decline in revenue growth at -3.37%, but the company maintains a stable gross profit margin of approximately 15.09%. The net profit margin is modest at 2.26%, reflecting some profitability. However, the EBIT margin of 4.64% and EBITDA margin of 15.76% suggest operational efficiency. The company needs to focus on reversing the negative revenue growth trend to improve its financial health.

Balance Sheet

The balance sheet of Select Energy Services shows a solid equity base with a debt-to-equity ratio of 0.39, indicating moderate leverage. The return on equity (ROE) is 4.15%, which is relatively low but stable. The equity ratio is not explicitly calculated, but the company's equity position appears strong relative to its total assets. Overall, the balance sheet reflects financial stability with manageable debt levels.

Cash Flow

Cash flow analysis reveals some challenges for Select Energy Services. The free cash flow growth rate is significantly positive at 191.99%, but the free cash flow itself is negative, indicating potential liquidity issues. The operating cash flow to net income ratio is 0.90, suggesting that operating cash flow is nearly covering net income. However, the negative free cash flow to net income ratio of -0.11 highlights the need for improved cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.41B	1.45B	1.59B	1.39B	764.62M	605.11M
Gross Profit	244.84M	219.47M	231.66M	160.75M	20.86M	-29.27M
EBITDA	215.67M	211.02M	165.29M	174.03M	44.30M	-299.40M
Net Income	19.93M	30.64M	74.40M	48.28M	-42.23M	-338.68M
Balance Sheet
Total Assets	1.59B	1.37B	1.22B	1.22B	950.19M	875.36M
Cash, Cash Equivalents and Short-Term Investments	17.83M	19.98M	57.08M	7.32M	85.80M	169.04M
Total Debt	338.48M	132.74M	53.55M	80.16M	67.31M	75.31M
Total Liabilities	656.50M	450.75M	326.02M	339.13M	255.02M	169.48M
Stockholders Equity	808.11M	793.52M	772.49M	765.98M	592.10M	593.06M
Cash Flow
Free Cash Flow	-61.15M	61.73M	149.49M	-38.65M	-56.24M	84.57M
Operating Cash Flow	216.99M	234.89M	285.36M	33.23M	-16.25M	105.81M
Investing Cash Flow	-388.09M	-318.62M	-137.17M	-53.25M	-64.46M	-5.39M
Financing Cash Flow	177.99M	46.64M	-98.42M	-58.45M	-2.54M	-10.71M

Select Energy Services Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 11.17
• 50DMA: Negative
• 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 WTTR, the sentiment is Positive. The current price of 11.17 is above the 20-day moving average (MA) of 10.73, above the 50-day MA of 10.82, and above the 200-day MA of 9.44, indicating a neutral trend. The MACD of 0.02 indicates Positive momentum. The RSI at 49.66 is Neutral, neither overbought nor oversold. The STOCH value of 36.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WTTR.

Select Energy Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HTO	69 Neutral	$1.78B	15.72	7.65%	3.37%	11.39%	13.86%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
ARIS	64 Neutral	―	―	7.11%	2.22%	16.42%	12.98%
WTTR	62 Neutral	$1.30B	55.17	2.48%	2.61%	-4.60%	-67.28%

Select Energy Services Corporate Events

Select Energy Services Implements Executive Severance Agreements

On October 9, 2025, Select Water Solutions, LLC, a subsidiary of Select Energy Services, announced the implementation of severance agreements with key executive officers to standardize compensation and enhance executive retention. These agreements aim to provide severance benefits under specific termination conditions, including changes in control, and include non-competition, non-solicitation, and confidentiality obligations, which may impact the company’s operational stability and talent management strategy.