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Tuesday, September 29, 2020

Valaris plc (NYSE:VAL) on the Path to Ruin

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The Valaris plc (VAL) shares are trading at lower $0.60 and the avg recommendation for the stock is Hold.

To add more color to this target, the company’s high over the last year is $8.75 and the low is $0.29. Over the last 52 weeks, VAL is down -93.16% while the S&P 500 is up 0.81%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, VAL reported a profit of $-19.4 million. Valaris plc also saw revenues decrease to $456.6 million. In addition, VAL has free cash flow of -$240.7 million as of 03-2020. The company’s EBITDA came in at -$2.88 billion which compares well with its peers.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. VAL has a short ratio of 2.79 and outstanding shares of 197.90M.

Company Outlook

VAL has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 7.24 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at -14.93. Valaris plc VAL also noted assets of $14.03 billion at the end of the last quarter. Investors should also keep an eye on sector updates as VAL has historically followed its peers on positive news.

All told, Valaris plc VAL has strung together solid data and demonstrated underlying fundamentals. At its current valuation, VAL represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Valaris plc VAL is now commanding a market cap of 127.42M and a float of 167.67M. VAL is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of VAL stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in VAL, either long or short, and we have not been compensated for this article.

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