Patterson-UTI raised, Weatherford cut at Goldman with focus on capital returns

Patterson-UTI Energy (NASDAQ:PTEN) +1.2% as Goldman Sachs upgrades to Buy from Neutral with a $10 price target, while Weatherford (WFRD) -2.1% as Goldman cuts to Neutral from Buy as part of a review of the oil services sector (OIH).

The bank views the broader sector in a negative light for 2025 with little activity change potential, with companies needing to compete for investor capital, particularly in the context of higher growth secular trends in power.

Goldman analyst Ati Modak thinks Patterson-UTI (PTEN) stands out with its 21-year track record of consistent dividend payments and current 4.1% yield, with an upgrade that reflects an anticipated ~11% total return, significantly higher than the North American average of ~7%.

For international exposure, Modak likes Buy-rated SLB (SLB) for the ~6% total between shareholder returns and revisions, while Weatherford (WFRD) is downgraded due to a ~4% total return in comparison, particularly following the stock’s strong recent relative performance.

Goldman also highlights Buy-rated Halliburton (HAL), which is seen offering ~8% in combined dividends, buybacks and revision potential, and as a high-quality play for a potential gas activity inflection in H2 2025.

The bank also maintains Sell ratings on NOV (NOV) and Helmerich & Payne (HP), which are projected to offer a weaker combination of returns and revisions compared to peers.