HOUSTON - Weatherford International plc (NASDAQ: NASDAQ:WFRD), a global energy services company, has announced the acquisition of Datagration Solutions Inc., a firm known for its expertise in data integration, analytics, and machine learning. The transaction, which took place today, is set to enhance Weatherford's digital offerings in production and asset optimization.
The integration of Weatherford's digital solutions with Datagration's unified data models aims to improve surveillance, optimization, and decision-making throughout the well lifecycle. This strategic move is expected to amplify the capabilities of Weatherford's existing platforms, including ForeSite®, CygNet®, and CENTRO®, and drive digital transformation within the company.
Additionally, the acquisition is projected to streamline operating efficiencies across Weatherford's enterprise, integrate disparate emissions data, and bolster emissions tracking and sustainability management. These improvements are anticipated to deliver increased value to Weatherford's customer base.
Girish Saligram, President and CEO of Weatherford, stated, "This acquisition of Datagration is another step forward as we continue to differentiate our technology portfolio." He expressed optimism about the enhanced enterprise capabilities and the acceleration of innovation and growth in the digital transformation of the energy industry.
Weatherford is known for integrating advanced digitalization with proven technologies to create sustainable offerings that maximize value and investment return. The company operates in approximately 75 countries with a diverse workforce of around 19,000 employees.
This acquisition is part of Weatherford's ongoing commitment to innovation and its efforts to remain at the forefront of digital advancements in the energy sector. The addition of Datagration is expected to strengthen Weatherford's position and provide its customers with more advanced and efficient solutions.
The financial terms of the acquisition were not disclosed in the press release statement.
In other recent news, Weatherford International reported a strong financial performance in its second quarter 2024 earnings call, highlighting a 10% year-over-year revenue increase, primarily fueled by its international business. Despite facing challenges such as social unrest and operational disruptions, the company showcased resilience and introduced a shareholder return program. Adjusted EBITDA margins reached 26%, while adjusted free cash flow was reported at $96 million. The company also announced a $1 per share annual dividend and a $500 million share buyback over three years. Looking ahead, Weatherford anticipates mid-single digit revenue growth in the latter half of 2024, with a more pronounced increase expected in Q4. The company's outlook includes an aim for a 30% return on invested capital and a continued focus on net working capital efficiency and reducing interest costs. These recent developments underscore Weatherford's strategic moves towards future growth, efficient capital allocation, and a positive outlook on international markets.
InvestingPro Insights
As Weatherford International plc (NASDAQ: WFRD) makes strategic moves to enhance its digital capabilities with the acquisition of Datagration Solutions Inc., investors and industry watchers are keen to understand the company's financial health and potential for growth. Weatherford's recent market performance and financial metrics, sourced from InvestingPro, offer a glimpse into the company's current standing and future prospects.
With a market capitalization of $7.68 billion, Weatherford trades at a price-to-earnings (P/E) ratio of 15.07, suggesting that the stock may be trading at a reasonable valuation relative to its near-term earnings growth. This is reinforced by the company's price-to-earnings growth (PEG) ratio for the last twelve months as of Q2 2024, which stands at an attractively low 0.17. The PEG ratio, which measures the stock's P/E ratio relative to its earnings growth rate, indicates that investors could be looking at a potentially undervalued stock if Weatherford's earnings growth is robust.
Weatherford's revenue growth also paints a positive picture, with a 13.55% increase over the last twelve months as of Q2 2024. This growth momentum is critical for the company as it continues to invest in digital transformation initiatives, such as the recent acquisition aimed at bolstering its production and asset optimization services.
InvestingPro Tips highlight that Weatherford operates with a moderate level of debt and has liquid assets that exceed its short-term obligations, providing the company with financial stability and flexibility. Furthermore, analysts predict the company will be profitable this year, a sentiment that is backed by the company being profitable over the last twelve months. These insights, coupled with a strong return over the last five years, suggest that Weatherford is on a solid footing as it embarks on new ventures to enhance its digital offerings.
For investors seeking more detailed analysis and additional insights, there are over eight InvestingPro Tips available at https://www.investing.com/pro/WFRD. These tips could provide valuable guidance for those considering Weatherford International as a potential investment, especially in the context of the company's latest strategic acquisition.
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