Barclays has recently upgraded Cactus Inc. (NYSE: WHD) from “Equal Weight” to “Overweight,” with a new price target of $54. This upgrade comes on the heels of Cactus’s acquisition of a 65% stake in Baker Hughes’ Surface Pressure Control business for $344.5 million. The deal significantly broadens Cactus’s international exposure, particularly in the Middle East, and introduces a more stable, project-based revenue profile.
📌 The acquisition adds scale to Cactus’s already strong U.S. footprint while opening doors to global markets and long-cycle projects. Analysts at Barclays cited this strategic move as a key driver behind the upgrade, noting it sets the stage for meaningful earnings growth and improved margin stability over time.
📌 Financially, Cactus is in a strong position. The company reported a better-than-expected Q1 2025, with EPS at $0.73 compared to a forecasted $0.67 and revenue at $280.32 million versus expectations of $270.57 million. Its balance sheet remains robust, with a current ratio near 4.85 and a net cash position that underscores its ability to fund growth initiatives without compromising financial health.
📌 Dividend Fundamentals:
💰 Annual Dividend: $0.52 per share
📈 Dividend Yield: Approximately 1.23%
🧮 Payout Ratio: Roughly 18%
🌱 Dividend Growth: Steady increases over the last five years
Cactus’s dividend profile shows a conservative approach, prioritizing sustainable growth while maintaining shareholder returns. The modest yield reflects a strategy focused on reinvestment and long-term value creation rather than aggressive payout expansion.