WFRD Stock Forecast & Price Target

Weatherford International is projected to experience significant growth, with international revenues expected to rise by 2-3% in 2025 and a robust 5% increase in Middle East revenue fueled by recent contract wins. The company anticipates a 200 basis points improvement in EBITDA margins over the next three years, even in a flat operating environment, alongside a 60 basis points enhancement in margins driven by development and engineering services. Overall, the firm has demonstrated higher margins and free cash flow than at any time in its history, highlighting a fundamentally strong outlook that supports a higher stock price.

Weatherford International's stock is considerably undervalued, trading 50% below its long-term average EV/EBITDA multiple, despite achieving record high margins and free cash flow. The firm is likely to face significant revenue declines in Latin America by approximately 20% in 2025, coinciding with a contraction in EBITDA margins across various segments. Furthermore, the company's dependency on letters of credit exposes it to vulnerability amidst a negative capital market sentiment, coupled with rising costs of raw materials that it may struggle to pass onto customers, potentially jeopardizing its financial stability.