Hunting Company Research (HTG)

Hunting has reaffirmed that FY24 EBITDA will be in line with October’s revised US$123m-126m guidance, the midpoint of which represents c.22% y-o-y progress. As previously noted, the OCTG and Subsea product groups have delivered strong performances while Hunting Titan/Perforating Systems (PS) has had to contend with depressed North American onshore activity levels. Management has again raised year end net cash guidance (and for the third time during FY24) to US$100m-105m driven by successful shipment delivery and cash collection schedules we believe. Together with US$300m recently updated bank finance facilities, this places Hunting in a strong position to progress its 2030 strategy. Compared to our last update, we note that the group net cash position and stronger US dollar (now £/US$1.21 versus 1.31 previously) are both more favourable inputs. For now, we believe that Hunting’s current share price is discounting levels of profitability significantly lower than the group is currently achieving. We retain our fair value / share at 397p.