Fundamental analysis: Dril-Quip, Inc. (DRQ)

Awarener score: 3.8

Conclusion

The higher the Awarener score, the more bang you get for the buck. It measures how much genuine funds the company generates for the stock price paid (Very poor), the business stability (Good) and growth (Very poor), and the company's inclination to return cash to the stockholders (Good).

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 4.5

Business has been shrinking at a fast pace. It's been below average when measured against peer companies.
Dril-Quip, Inc. business trend stability is good. The higher the stability, the lower the risk. It looks better than most rivals.

Margins score: 3.7

DRQ profit margins -on goods and services sold- are usually good. They stand better than most rival companies.
Business profit on sales tends to be very poor. It's weak when measured against competitors.
Profits on sales made -available to repay debt and purchase properties- are usually very poor. They remain in a weak position compared to peers.
Earnings -before income taxes and interests on loans taken- tend to be very poor in relation to total revenues. They're still mediocre against similar companies.
Profits -before income taxes- are usually very poor considering total sales, and remain weak when measured against rivals.
Total net profit tends to be very poor when confronted to sales. Company stands weak when measured against comparable firms.

Growth score: 2.1

Dril-Quip, Inc. profit -on goods and services sold- has been growing at an excellent pace. It's been excellent in relation to competitors.
In recent years, the firm hasn't always been able to profit from operations, which has been bottom tier against comparable firms.
In past years, the company couldn't always turn a profit -available to repay debt and purchase properties-, which compares last-in-rank when measured against peer enterprises.
In the previous years, the firm couldn't always make a profit -before income taxes and interests on loans taken-. It turns to be a disappointment compared to similar stocks.
In past years, at least once the company lost money -before income taxes-. It was bottom tier against rivals.
In the previous years, the firm had at least a total net loss, and last-in-rank when measured against peer companies.
The company lost money at least once in the past years. It's been a disappointment compared to industry peers.

Miscellaneous score: 3.7

DRQ had still to pay income taxes, even though in recent past years mostly lost money. It's been bottom tier against peers.
Research and development expenses consume a sparse portion of revenues. It's below average when measured against competitors.
Business has been shrinking, despite research and development efforts. It stands close to average when compared to rival companies.

Profitability score: 4.0

Dril-Quip, Inc. usually gets low returns on the resources it controls. It proves below average when measured against peer firms.
The company normally gets low proceeds -on the resources directly invested in the business-. They remain lacking compared to similar companies.
Profitability -in relation to owned resources- is usually lacking. It ranks almost average when measured against competitors.
In the past, got low returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's below average when measured against comparable enterprises.

Usage of Funds score: 3.0

DRQ on average doesn't generate genuine funds, so to buy or replace property, plants and equipment must either burn existing cash or increase debt. It stands below average when measured against rival firms.
The company is usually replacing part of the property, plant, and equipment that gets old, keeping some funds for something else. It can't keep forever, which is below average when measured against industry peers.
In the past twelve months the stock paid no dividends. It came bottom tier against competitors.
The company pays no dividend, so measuring its growth is meaningless. The company has behaved in an conservative way compared to similar firms.
As no dividends are paid, it is useless trying to estimate their sustainability in time. Sustainability looks not applicable in regard to comparable companies.
The company usually reduces the pool of investors, resulting in fewer mouths feeding on the pie of profits. It remains impressive in relation to peer enterprises.
Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands in a weak position compared to rivals.
The company generates very few genuine funds. Investor rewards must be paid burning existing cash or by borrowing money, which isn't sustainable in the long run. Unless business prospects improve greatly, stockholder compensation could be at risk. It still looks last-in-rank when measured against competitors.

Balance Sheet score: 5.1

Dril-Quip, Inc. intangible assets (like brands and goodwill) represent a non-significant portion of resources controlled, according to accounting books, which is safer. It happens to be encouraging in relation to peer companies.
The company has more than enough short-term resources to face short-term obligations. Liquidity concerns are non-significant. It turns to be excellent in relation to similar firms.
Almost no resources controlled were provided for with financial debt. Financial strength is great. Company could significantly increase debt if it wished so, to reinvest in business, to buy a smaller company or to reward stockholders. It remains top-notch against rival firms.
Controlled resources take time to be turned into cash and equivalents, which is somewhat risky. It looks substantially worse when measured against rivals.
For every dollar of short-term obligations, the company has abundant dollars in cash and short-term receivables. It's impressive in relation to peer firms.
For every dollar of short-term obligations, the company has more than enough dollars in cash and equivalents, which is top-notch against similar enterprises.
Usually, sales are on somewhat more than three months credit. It still ranks weak when measured against peers.
Normally has more than six months of sales worth in inventory. It comes up as a disappointment compared to competitors.
On average, it takes plenty of months from the purchase to charging customers. It happens to be bottom tier against peers.
On average pays suppliers many months after the purchase. It ranks top tier when measured against industry peers.
The company pays its suppliers plenty of months before charging its customers, so there's a lot of money invested in working capital. It's a disappointment compared to similar companies.
Company earns net interest income on its investments and therefore is in a quite comfortable financial position. It stands top-notch against rival firms.
Business has usually been operated at a loss. Unless prospects improve, the company is no position to decrease loans taken levels but by additional shareholders' funding. Profitability must improve. It ranks last-in-rank when measured against comparable enterprises.
Revenues are low in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. The more property, plant, and equipment used, the more the company must reinvest to fight obsolescence, which usually means less available funds for the shareholders in the long run. It looks lacking compared to similar firms.
Resource exploitation is slightly low when yearly sales are considered, business volume should be increased. This metric is normally tied to the industry where the firm belongs. It's still bottom tier against peer companies.

Valuation score: 4.5

Dril-Quip, Inc. profits are really small compared to market valuation, market valuation doesn't rely on current earnings. It happens to be substantially worse when measured against competitors.
Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains in good shape compared to peers.
In the past twelve months, the company consumed funds. Either it reinvested significantly in the business or genuine fund generation might be struggling, which stands bottom tier against similar companies.
The company usually consumes much more funds than can genuinely generate. Business needs are meet by borrowing money or consuming preexistent cash, which can only keep up until a certain limit. Unless the company is driving significant business growth, genuine profitability may be brought into question. It's still last-in-rank when measured against industry firms.
In the past twelve months, the company has barely rewarded investors, considering both dividends and share on the pie of earnings. It came up excellent in relation to peer ventures.
This company is a cash hoarder. It might be well poised to substantially increase stockholder payments, or to fund new business projects. It looks top-notch against similar enterprises.
Considering the past twelve months, traditional Price-to-Earnings relation is huge, as profits were extremely low in relative terms. It ranks substantially worse when measured against peer companies.
Comparing the current stock price with the past twelve-months revenues gives a high relationship. This is an important metric to check its evolution through time, and to compare to industry peers. It looks in a very weak position compared to rival firms.
The relation between the stock price and accounting book value might be reasonable. It's important both to check this metric through time and to compare it with rival companies. The company remains somewhat better than peer firms.
In the past twelve months, the operating business lost some money. It happens to be below average when measured against industry peers.
In an alternate metric of bang for the buck, the company has usually shown a low earnings power ability when measured against the current stock price and financial position. It's still in a weak position compared to peer companies.

Total score: 3.8

Company at a glance: Dril-Quip, Inc. (DRQ)

Sector, industry: Energy, Oil & Gas Equipment & Services

Market Cap: 0.96 billions

Revenues TTM: 0.36 billions

Dril-Quip, Inc., together with its subsidiaries, designs, manufactures, sells, and services engineered drilling and production equipment for use in deepwater, harsh environment, and severe service applications worldwide. The company's principal products include subsea and surface wellheads, subsea and surface production trees, mudline hanger systems, specialty connectors and associated pipes, drilling and production riser systems, liner hangers, wellhead connectors, diverters, and safety valves, as well as downhole tools. It also provides technical advisory services, and rework and reconditioning services, as well as rental and purchase of running tools for use in the installation and retrieval of its products; and downhole tools comprise of liner hangers, production packers, safety valves, and specialty downhole tools that are used to hang-off and seal casing into a previously installed casing string in the well bore. The company's products are used to explore for oil and gas from offshore drilling rigs, such as floating rigs and jack-up rigs; and for drilling and production of oil and gas wells on offshore platforms, tension leg platforms, and Spars, as well as moored vessels, such as floating production, storage, and offloading monohull moored vessels. It sells its products directly through its sales personnel, independent sales agents, and representatives to integrated, independent, and foreign national oil and gas companies, as well as drilling contractors, and engineering and construction companies. The company was founded in 1981 and is headquartered in Houston, Texas.