Are things falling part for Key Energy Services, Inc. (NYSE:KEG)? That is the question that naturally comes to the mind of investors when they see oil prices falling and analysts taking bearish actions on oil stocks. The question specific to Key Energy Services is what the recent analyst moves say about the stock?
Recently analysts at Global Hunter Securities lost favor with Key Energy Services, Inc. (NYSE:KEG) that they downgraded their rating on the stock and also cut their target price on it. The analysts cut rating on the stock to “Reduce” from “Neutral”. However, they did not stop there as they seemed to believe that the future will likely be more challenging for the company than the present. As such, they also cut their target price on Key Energy Services.
The analysts now have $1.50 target price on the stock. They previously had $2.50 target price on it.
Before analysts at Global Hunter Securities made their bearish move on Key Energy Services, Inc. (NYSE:KEG), analysts at Iberia Capital had lifted hope in the stock. The analysts set $3.50 target price on KEG and also upgraded it to “Outperform” from “Sector Perform”.
Oil price fallout
The move by Global Hunter on Key Energy Services, Inc. (NYSE:KEG) seems to be linked to the fallout of prices in the oil market. The analysts seemed worried that the company could not be a good position to withstand continued decline in oil prices, which has seen several oil companies reduce their capital spending for the next year.
However, a recent uptick in oil prices seemed to suggest that all is not lost for Key Energy Services, Inc. (NYSE:KEG) and its peers in the oil industry. That explains why some analysts still find a reason to maintain positive rating on the stock or upgrade their rating of the stock even amid the oil price fallout.
Key Energy Services, Inc. (NYSE:KEG) generated revenue of $365.80 million in the most recent quarter. That was better $350.60 million in the previous quarter but bellow $389.67 million a year earlier. It closed the quarter with $57.39 million in cash and equivalents, indicating an improvement from $23.45 million in the previous quarter.