OIS

We rate OIL STATES INTERNATIONAL, INC (OIS) as a Hold with a composite score of 61.6/100 at a current price of $14.50. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling for existing holders. Our factors are split, and the overall profile suggests patience is warranted.

The rating is primarily driven by strength in momentum (83th percentile) and value (78th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (32th percentile) and stability (39th percentile) tempers our overall conviction. We assign a No Moat rating (32/100), High uncertainty, and Poor capital allocation.

Key items to watch: whether strong momentum is fundamentally supported by revenue trends; the path to profitability. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

OIL STATES INTERNATIONAL, INC holds a top-quartile position (#0 of 50) within the Manufacturing sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 61.6/100 places it at rank #542 in our full 7,333-stock universe. At $367M in market capitalization, OIL STATES INTERNATIONAL, INC is a small-cap player in the Manufacturing space, which limits certain scale advantages but may allow for more agile strategic execution.

Despite positive momentum (83th percentile), revenue contraction of -11% creates a divergence between price action and fundamental trajectory. This divergence suggests either that the market is looking through near-term weakness or that technical factors are temporarily inflating the stock. Investors should assess whether the revenue decline reflects cyclical weakness or structural challenges.

The margin cascade tells an important story: gross margins of 23% (-19.7pp vs sector) narrow to operating margins of 1% (-0.5pp vs sector) and net margins of -0.9%, yielding a gross-to-net conversion rate of -4%. The significant margin erosion from gross to net suggests elevated operating expenses, high interest costs, or other structural drags that warrant monitoring.

At a current price of $14.50, OIL STATES INTERNATIONAL, INC appears undervalued relative to its fundamentals. Our value factor score of 78/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. The stock screens as attractively priced on a majority of these measures, suggesting the market may be underappreciating the underlying fundamentals.

The stock currently trades at a P/E of 450.7x (a 1925% premium to the sector median of 22.3x), EV/EBITDA of 13.8x (at a premium), P/B of 1.1x, P/S of 1.1x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis finds only partially justified by current fundamentals.

We assign a High uncertainty rating to OIL STATES INTERNATIONAL, INC. Key risk factors include elevated market sensitivity (beta of 1.81), current negative profitability (net margin -0.9%), below-average price stability (39th percentile). The wide range of potential outcomes widens our fair value estimate and increases the possibility of permanent capital impairment. Investors considering this name should size positions accordingly and demand a meaningful margin of safety before initiating.

Specific risk factors that inform our assessment include: elevated market sensitivity (beta of 1.81); current negative profitability (net margin -0.9%); below-average price stability (39th percentile); elevated valuation multiple (P/E 450.7x) that leaves limited margin for error. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 39th percentile and quality factor at the 51th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: conservative leverage (0% D/E) limits balance sheet risk. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile warrants caution and disciplined position management.

We rate OIL STATES INTERNATIONAL, INC's capital allocation as Poor. Key concerns include low returns on equity (-0.9%), negative profitability, weak asset returns (ROA -0.6%). Exemplary capital allocators generate ROE above 20% and maintain conservative leverage — OIL STATES INTERNATIONAL, INC significantly underperforms these benchmarks, raising questions about management's ability to create shareholder value.

Investors should scrutinize management's reinvestment decisions and balance sheet trajectory before committing capital. Poor capital allocation often compounds over time: overlevered balance sheets limit strategic flexibility, while low returns on capital destroy shareholder value. We would need to see sustained improvement in profitability metrics and balance sheet discipline before considering an upgrade.

In summary, OIL STATES INTERNATIONAL, INC receives a Hold rating with a composite score of 61.6/100 (rank #542 of 7,333). Our quantitative framework assigns a No Moat (32/100, trend: stable), High uncertainty, and Poor capital allocation. The average factor score across quality, value, momentum, stability, and investment is 57/100.

Our analysis supports a neutral stance on OIL STATES INTERNATIONAL, INC. While the quantitative profile is not weak enough to warrant selling, it lacks the multi-factor strength required for a buy recommendation. Existing holders should maintain positions and monitor for catalysts — either fundamental improvement or valuation compression — that would shift the risk-reward balance.