Cactus Inc. Class A Common Stock (WHD)

FairStock Score: 42/100 — MIXED

Key Financials

Strengths

• Solid return on equity of 14.9% above cost of capital
• Conservative balance sheet with debt-to-equity of just 0.03, providing financial flexibility
• Altman Z-Score of 6.5 confirms minimal bankruptcy risk and strong solvency

Concerns

• Trades significantly above Graham Number ($31) with negative 78% margin of safety—limited downside protection
• Revenue declining at 4.0% year-over-year signals potential demand weakness or market share loss

AI Analysis

Cactus Inc. Class A Common Stock is a small-cap energy company valued at $3.8 billion. The business generates $1.1 billion in annual revenue with a 3.7% net margin. From a quality standpoint, Cactus shows Altman Z-Score of 6.5 confirms fortress-level solvency and adequate 15% ROE. On valuation, the stock is reasonably priced at 23.0x earnings, with trades above its Graham Number with a negative 78% margin. Growth dynamics show revenue growing at -4.0% and profit growth of -14.7%. The 1.0% dividend yield adds an income component for patient holders. Our composite FairStock Score of 42/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. Operational leverage in the business model means incremental revenue growth could disproportionately boost bottom-line profitability.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the energy space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer