Shares of Helix Energy (HLX) closed the last trading session up a solid 5.5% at $10.80. This surge came on heavy volume, indicating strong investor interest. While the stock has faced some headwinds in recent weeks, losing 10.7% over the past four weeks, this latest jump suggests a shift in sentiment.
The driver behind this surge? Increased demand for Helix Energy’s oilfield services, particularly in crucial offshore markets like the U.S. Gulf of Mexico, the U.S. East Coast, and Brazil. This is driven by the company’s Well Intervention segment, which specializes in extending the life of existing oil wells. This approach is particularly appealing in today’s market, where upstream oil and gas companies are focused on shareholder returns rather than increasing production, even with favorable commodity pricing.
By helping companies extract more value from their existing resources, Helix is positioned to capitalize on this trend. This strategic approach has been a key growth driver for the company.
Looking ahead, Helix Energy is expected to report quarterly earnings of $0.21 per share in its upcoming report, representing a year-over-year increase of 10.5%. However, revenues are expected to be down 13.1% from the same period last year, reflecting the broader industry slowdown in drilling activities.
While earnings and revenue growth expectations offer valuable insight into a company’s potential, research shows that trends in earnings estimate revisions are closely tied to short-term stock price movements. For Helix Energy, the consensus EPS estimate for the quarter has been revised upward by 16.7% over the past 30 days. This positive trend in earnings estimates typically translates to price appreciation, suggesting potential for further upside in HLX.
It’s important to note that Helix Energy currently holds a Zacks Rank #3 (Hold). While this signifies a neutral outlook, the recent surge in the stock and positive earnings revisions warrant keeping a close eye on HLX to see if this momentum can translate into sustained strength in the future.
It’s worth comparing Helix Energy’s performance to another company within the Zacks Oil and Gas – Field Services industry. Subsea 7 SA (SUBCY) closed the last trading session up 1.2% at $16.20. However, SUBCY has experienced a more significant decline over the past month, losing 11.4%. The consensus EPS estimate for SUBCY’s upcoming report remains unchanged at $0.29, representing a year-over-year increase of 163.6%. Subsea 7 also currently holds a Zacks Rank of #3 (Hold).
Overall, the recent jump in Helix Energy’s share price suggests a renewed optimism surrounding the company’s prospects. The strong demand for its services, particularly in key offshore markets, and positive earnings revisions highlight the potential for further growth. While it’s too early to say whether this momentum will continue, investors should keep a close eye on HLX to assess its future trajectory.
