Value
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 2.3 |
| P/S | 8.1 |
| EV/EBITDA | 4.8 |
| Fwd P/E | 7.3 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 17.2x
- ▸PEG: 0.09
WHD · Why this verdict
Why Cactus, Inc. Class A Common Sto (WHD) is rated BUY WAIT
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictBUY WAIT
Overall score6.4/10
ConfidenceHIGH
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Cactus Inc. is the industry growth leader in oil and gas equipment with 38% year-over-year revenue growth, a Piotroski score of 8 out of 9, and 3 consecutive earnings beats — but the stock is already trading above analyst targets and carries an elevated put/call ratio, making entry timing critical.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Cactus delivered 38% year-over-year revenue growth and ranks as the industry growth leader among oil and gas equipment peers, suggesting strong demand for its wellhead systems and casing-running equipment as drilling activity increased. Peer-rank breakdown | Revenue growth remains above 15% year-over-year for at least 2 consecutive reported quarters, maintaining the company's industry-leading growth position. | →Stable |
| CounterOil and gas equipment demand is directly tied to upstream capital spending, which can decline rapidly if oil prices fall; 38% growth during an up-cycle provides no protection if the cycle turns. | ||
Cactus has beaten earnings estimates in 3 of the last 4 quarters, with the 3 most recent beats averaging 10.5% positive surprise — indicating management is consistently delivering above consensus expectations. Earnings | Beat rate remains at 3 or better in the next 4 quarters, with average positive surprise exceeding 5%. | ↓Deteriorating |
| CounterThe one miss in the streak was -8.4%, and the elevated put/call ratio of 1.75 suggests options traders are positioned for a near-term miss despite the historical track record. | ||
At $58.07, Cactus trades 5.1% above the analyst consensus price target — an unfavorable asymmetry of -0.73 where analysts collectively believe the stock is overvalued at current levels, limiting upside potential for new buyers. Targets | Analyst price targets are raised above $62 within 6 months following continued earnings beats, restoring at least 5% positive upside from the current price. | ↑Improving |
| CounterThe resistance-based take-profit target of $62.86 is above current prices, and the risk/reward to that level is 1.39x; a modest analyst target increase could make the entry attractive. | ||
A Piotroski score of 8 out of 9 combined with strong current ratio of 8.8 and positive free cash flow generation at 61% of net income indicates a financially healthy company with the balance sheet strength to sustain growth investment. Quality breakdown | Piotroski score remains at 7 or higher for the next 2 reported annual periods, and free cash flow as a percentage of net income improves to above 80%. | →Stable |
| CounterFree cash flow at 61% of net income is below the 100% threshold that indicates excellent cash quality; the earnings quality warning suggests cash generation may not be as strong as GAAP earnings imply. | ||
Cactus delivered 38% year-over-year revenue growth and ranks as the industry growth leader among oil and gas equipment peers, suggesting strong demand for its wellhead systems and casing-running equipment as drilling activity increased.
→StablePeer-rank breakdown
- Expectation
- Revenue growth remains above 15% year-over-year for at least 2 consecutive reported quarters, maintaining the company's industry-leading growth position.
CounterOil and gas equipment demand is directly tied to upstream capital spending, which can decline rapidly if oil prices fall; 38% growth during an up-cycle provides no protection if the cycle turns.
Cactus has beaten earnings estimates in 3 of the last 4 quarters, with the 3 most recent beats averaging 10.5% positive surprise — indicating management is consistently delivering above consensus expectations.
↓DeterioratingEarnings
- Expectation
- Beat rate remains at 3 or better in the next 4 quarters, with average positive surprise exceeding 5%.
CounterThe one miss in the streak was -8.4%, and the elevated put/call ratio of 1.75 suggests options traders are positioned for a near-term miss despite the historical track record.
At $58.07, Cactus trades 5.1% above the analyst consensus price target — an unfavorable asymmetry of -0.73 where analysts collectively believe the stock is overvalued at current levels, limiting upside potential for new buyers.
↑ImprovingTargets
- Expectation
- Analyst price targets are raised above $62 within 6 months following continued earnings beats, restoring at least 5% positive upside from the current price.
CounterThe resistance-based take-profit target of $62.86 is above current prices, and the risk/reward to that level is 1.39x; a modest analyst target increase could make the entry attractive.
A Piotroski score of 8 out of 9 combined with strong current ratio of 8.8 and positive free cash flow generation at 61% of net income indicates a financially healthy company with the balance sheet strength to sustain growth investment.
→StableQuality breakdown
- Expectation
- Piotroski score remains at 7 or higher for the next 2 reported annual periods, and free cash flow as a percentage of net income improves to above 80%.
CounterFree cash flow at 61% of net income is below the 100% threshold that indicates excellent cash quality; the earnings quality warning suggests cash generation may not be as strong as GAAP earnings imply.
Per-dimension breakdown
Quality
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.4 |
| ROA | 4.9 |
| Gross margin | 2.6 |
| Op margin | 7.4 |
| Net margin | 6.0 |
| Current ratio | 8.8 |
| FCF quality | 5.9 |
| Moat | 6.9 |
| Piotroski F | 10.0 |
- ▸Earnings quality warning: 79% FCF/NI
- ▸Strong Piotroski F-Score: 9/9
Growth
7.9/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 5.8 |
- ▸Strong growth: 64% YoY
Momentum
3.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 7.9 |
| MACD | 1.2 |
| OBV | 1.0 |
| MA position | 4.0 |
| Volume | 0.7 |
- ▸Uptrend pullback (RSI 36) - buy opportunity
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.5 |
| Analyst rating | 6.9 |
| Price target | 7.3 |
- ▸LLM news sentiment: +0.50 (n=1)
- ▸Light analyst coverage (9.0) — signal dampened
Insider
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 2.0 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Heavy insider selling — $55,984,388 (1.284% of mkt cap)
- ▸Institutions accumulating
Peer rank
7.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.4 |
| quality rank | 7.7 |
| growth rank | 8.8 |
- ▸Best-in-class margins
- ▸Industry growth leader
Technical
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 9.4 |
| support resistance | 8.9 |
| 52w position | 6.6 |
Risk (lower is worse)
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.3 |
| days to cover | 6.6 |
| volatility | 4.8 |
| put call | 0.0 |
| implied vol | 5.0 |
| beta | 5.3 |
| debt equity | 9.9 |
- ▸Elevated put/call: 3.50
Catalyst
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 3.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.5 |
| news activity | 5.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 13 days
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more. | News modifier +1 (HOLD_IF_HOLDING → STRONG_BUY_WAIT).
Engine technical detail
verdict_path:
L4:PATH_F_HOLD|L3:NEWS_MOD=+1Passed (3)
- NEWS_BOOST:ANALYST:0.50
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:3.0<4.5
- ASYMMETRY:0.3<1.5@spot
- INSIDER:1.28%=EXTREME
Warning (2)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
- EARNINGS_PROXIMITY:13d<=14d (soft)
Reward-to-Risk
0.28
Upside
+1.7%
Downside
6.2%
Sizing output
STARTER
Setup— — No clear chart pattern; technical signals are mixed
EdgeCatalyst-Driven — Earnings in 13d with 4/4 beat streak
SuitabilityAggressive — Beta 1.43>1.3, MCap $4.4B<$5B
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: NEWS_BOOST:ANALYST:0.50. Top dim: Technical at 8.3; weakest: Momentum at 3.0. No conviction either direction.
The strongest dimensions are Technical at 8.3, Growth at 7.9, and Sentiment at 7.2; the weakest are Momentum at 3.0, Insider at 5.2, and Risk (lower is worse) at 5.6. The V9 engine flagged 3 failed gates with 2 warnings, producing an asymmetric reward-to-risk of 0.28 and an engine sizing output of STARTER.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Industry Leading Growth
Trip ifRevenue growth falls below 10% year-over-year for at least 2 consecutive reported quarters.
- P2Consistent Earnings Beats
Trip ifEarnings surprise falls below 0% in at least 2 of the next 4 reported quarters.
- P3Price Above Analyst Targets
Trip ifPrice rises above $65, more than 12% above the current $58.07, without analyst price targets also rising above $63.
- P4Strong Balance Sheet Quality
Trip ifPiotroski score falls below 6 or free cash flow drops below 30% of net income for at least 2 consecutive reported periods.