- AWS Acquisition & Integration: Strengthened Permian Basin presence with AWS acquisition, enhancing scale and service offerings; integration progressing with team alignment and best practices.
- ECO Rig Program Momentum: Signed 15 ECO rig contract with a key operator in Lower 48; ECO rigs expected to constitute ~10% of active fleet.
- 2025 Financial Performance: Total revenue $547M, adjusted EBITDA $73.2M; Q4 revenue $142.2M (+8.8% QoQ), adjusted EBITDA margin 14.3% ($20.3M).
- Shareholder Returns & Liquidity: Returned >40% of free cash flow to shareholders via dividends/buybacks; ended 2025 with $67.7M liquidity ($57.4M revolver + $10.3M cash).
- 2026 CapEx & Growth: ECO program CapEx concentrated in H2 2026; 50% conversion rate expected, with potential for incremental contracts (<10 rigs). Plug-and-abandonment contract to utilize ~3 rigs initially.
Operational Highlights
The company's legacy core businesses continued to perform well, with the high-spec rig fleet benefiting from operational consistency and steady workload. The ECO rig program has also seen significant progress, with a contract signed for 15 ECO rigs with a key operator in the Lower 48. Stuart Bodden, Chief Executive Officer, expressed excitement about the momentum generated by the ECO platform and its potential to drive incremental value.
Integration of American Well Services (AWS)
The acquisition of AWS has strengthened the company's position in the Permian Basin and enhanced its scale and service offerings. Stuart emphasized that the integration of AWS is progressing well, with a focus on ensuring a cohesive operation, aligning teams, and implementing shared best practices.
Outlook and Valuation
The company expects the operating environment to remain generally stable in 2026, with a focus on execution and strategic evaluation. Analysts estimate next year's revenue growth at 10.8%. With a P/E Ratio of 30.9 and an EV/EBITDA of 6.23, the market is pricing in a certain level of growth. The company's commitment to maintaining operational discipline and its track record of consistent financial performance are positives. The Dividend Yield stands at 1.41%, providing some support to the stock.
Future Growth Prospects
The ECO rig buildout is expected to contribute to future growth, with the new rigs representing around 10% of the active fleet. Melissa Cougle discussed the capital expenditures for the ECO rig program, stating that most of the CapEx would show up in the back half of the year and that they expect a 50% conversion rate for the year. As the company continues to integrate AWS and advance the rollout of the ECO platform, it remains focused on maintaining operational discipline and exploring opportunities to strengthen its service offerings.