Jefferies upgrades Superior Energy Services
NEW YORK (AP) — Superior Energy Services got an upgrade from Jefferies & Co. on Thursday, which said that the oilfield service company's onshore business at home appears to be holding up better than expected and onshore prospects overseas appear stronger.
Analyst Brad Handler wrote that his main reservation about Superior had been the risk that margins would be squeezed this year because of service price declines. But first-quarter pricing "showed surprising resilience, even as some competitors appear to experience these issues."
Superior is also winning new contracts overseas and it's making modest acquisitions, Handler said. Business outside of the U.S. accounts for 21 percent of the company's estimated 2013 revenue.
Handler upgraded the shares to "buy" from "hold," even as the company neared a 52-week high Wednesday. He raised his price target to $33, from $26.
"That's never our choice, but again we stayed on the sidelines pending the comfort we describe above," Hander wrote. "We simply still see adequate upside to upgrade."
Shares of Superior Energy Services Inc. closed on Wednesday at $26.73. Their 52-week range is $17.54 to $27.61.