Patterson-UTI (PTEN) Soars 6.4%: Is Further Upside Left in the Stock?

Patterson-UTI (PTEN) shares ended the last trading session 6.4% higher at $7.03. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 2.3% gain over the past four weeks.

A surge in Patterson-UTI’s share price was driven by a strong operational and cash flow outlook outlined in its January 2026 investor presentation. The company highlighted better-than-expected cost controls in drilling, resilient completion activity with minimal spare horsepower, and expectations that adjusted free cash flow in the upcoming quarter was the strongest of the year. Lower capital expenditure guidance (under $500 million), high utilization of Tier-1 rigs and natural gas-powered frac assets, and a firm commitment to return at least 50% of adjusted free cash flow to shareholders reinforced investor confidence in earnings stability, capital discipline, and shareholder returns.

This provider of onshore contract drilling services is expected to post quarterly loss of $0.12 per share in its upcoming report, which represents no change from the year-ago quarter. Revenues are expected to be $1.09 billion, down 6.2% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Patterson-UTI, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on PTEN going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Patterson-UTI is part of the Zacks Oil and Gas - Drilling industry. Valaris Limited (VAL), another stock in the same industry, closed the last trading session 3.8% higher at $53.3. VAL has returned -10.9% in the past month.

Valaris' consensus EPS estimate for the upcoming report has changed +11.5% over the past month to $0.4. Compared to the company's year-ago EPS, this represents a change of -78.7%. Valaris currently boasts a Zacks Rank of #3 (Hold).

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This article originally published on Zacks Investment Research (zacks.com).

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