Cactus Inc

Cactus, Inc. is entering the second half of 2026 with faster earnings growth, expanding international exposure and substantial liquidity, but its premium valuation and execution risks argue against ignoring price discipline. Second-quarter Pressure Control revenues reached $344 million, helped by the Cactus International acquisition and stronger Middle East deliveries, while Spoolable Technologies generated $105.5 million in revenues with a margin improving to 39.9%. The company received more than $80 million of incremental international Spoolable Technologies orders in July, and total international purchase orders after the quarter exceeded $130 million. As of June 30, Cactus had $365.8 million in cash and no bank debt, with second-quarter operating cash flow of $104.6 million and net capital expenditures of $15.6 million. The Zacks Consensus Estimate calls for 2026 earnings of $3.07 per share, implying 14.1% growth, and the 2027 estimate rises to $3.54, another 15.4% increase. WHD trades at 3.2 times forward 12-month sales, above the sub-industry's 1.8 times and the stock's five-year median of 3.0 times, leaving less room for disappointment if international orders, margins or domestic activity soften.

Chevron, Baker Hughes, and Cactus are expected to report better-than-expected second-quarter earnings, according to Zacks Investment Research. The favorable energy business environment in the June quarter, driven by high commodity prices amid the Iran war, is likely to have boosted results. Baker Hughes has an Earnings ESP of +1.34% and a Zacks Rank of 3, with results due on July 26. Chevron, scheduled to report on July 31, has an Earnings ESP of +1.84% and a Zacks Rank of 3. Cactus, reporting on July 29, has an Earnings ESP of +7.04% and a Zacks Rank of 3.

StockStory identifies Cactus as a cash-producing stock worth watching, while flagging Getty Images and Disney as companies that may struggle. Cactus, which manufactures wellhead equipment for oil and gas, posted a trailing 12-month free cash flow margin of 25.8% and annual revenue growth of 23.2% over nine years, with its EBITDA margin expanding by 2.3 percentage points over five years. Getty Images, with a free cash flow margin of just 3%, saw its margin shrink by 12.4 percentage points over five years and delivered only 3.5% annual revenue growth. Disney's free cash flow margin stands at 7.3%, and its 10.8% five-year annual revenue growth is considered below standard for the consumer discretionary sector, with a return on capital of 7.3% reflecting difficulties in finding profitable growth.

Stifel raised its price target on Cactus, Inc. to $68 from $66 while maintaining a Buy rating, implying nearly 20% upside. The firm increased its 2026-27 forecasts following updated second-quarter guidance, citing higher confidence in both the pressure control and spoolable technologies segments. Cactus acquired a 65% stake in Baker Hughes' Surface Pressure Control business for $365 million in January 2026 and recently raised projected synergy targets by 50% to an annualized $15 million. The company's Pressure Control segment is expected to deliver adjusted EBITDA margins of 22% to 24% in the second quarter, remaining resilient despite the Middle East conflict.