PTEN
Patterson-UTI Energy, Inc.
$11.17
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Mild
·
Conviction
Overvalued
Trading 10.2% above fair value
You pay
$11.17
Bear
$4.05
Fair
$10.13
Bull
$18.25
Bear
$4.05
-63.8%
FCF $300M × 8x
Fair
$10.13
-9.2%
FCF $428M × 11x
Bull
$18.25
+63.4%
FCF $556M × 14x
Adjust Assumptions
75.0$/bbl
11.0x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
11.9x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (53 analysts)
$13.38
Divergence from AlphaVal
24%
Summary
At $75/bbl oil with a 11x EV/FCF multiple, intrinsic value is $10.13 per share. Range: $4.05 (bear) to $18.25 (bull).
Warnings
Where you think oil prices will settle long-term drives over 80% of this valuation. The biggest risk isn't the company itself — it's getting the commodity price wrong.
Key Risks
- Growth DCF inappropriate — commodity volumes do not compound
- Geopolitical premiums are real but historically temporary
- Reserve replacement ratio below 100% for 3 years is existential