• Investing Insights & Exclusive Offers → Get Our FREE “Market Brief”
    Sign-up for our free weekly newsletter. Get unparalleled investing insights and exclusive Summer Sale discounts on Hedgeye research.

    Disclaimer: By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails. Use of Hedgeye and any other products available through hedgeye.com are subject to our Terms Of Service and Privacy Policy

Takeaway: We are adding Apergy to the short side of Investing Ideas today.

Below is a brief note written by CEO Keith McCullough:

Energy Stocks continue to be a horrible place to be as the Commodities market prices in a #FullCycleInvesting Strong Dollar during Quad 4 in Q319.

One of our favorite Institutional Research Best SELL Ideas in Energy remains Apergy (APY). Here's a summary excerpt from our Energy analyst Al Richard's note post the recent quarter:

Takeaway: 2Q19 results soften YoY while the operating environment continues to deteriorate and the competitive set intensifies. Fair value = $20 - $25 / share. Short APY is a Hedgeye Energy Best Idea.

On the 2Q19 Results…… Revenue of $306MM came in below consensus estimates of $311MM. EBITDA of $75MM, after adjusting for a ~$3MM impairment & restructuring charge, was in-line with consensus and declined 3% YoY. Production & Automation Technology segment revenue declined 2% YoY while EBITDA declined 5% YoY on lower revenue and higher input costs. Drilling Technologies revenue declined 9% sequentially due to lower drilling activity and seasonal weakness in Canada. Segment EBITDA declined 9% due to lower revenue, while margins remained flat at 38% which the company attributed to cost and productivity initiatives.

Sell the bounce to lower-highs,

KM