Barclays upgrades Cactus to Overweight on leading market share

Barclays upgraded Cactus to Overweight from Equal Weight with a price target of $60, up from $48. With the global upstream spending cycle still in the early stages, Barclays remains positive on the energy services sector, the analyst tells investors in a research note. The firm says the current cycle “appears to be at roughly the first quarter mark with at least 3-4 years of visibility in a number of key upstream markets.” It believes Cactus is “uniquely positioned” around the U.S. onshore wellsite. Cactus has created a moat and gained leading market share in a formerly commoditized business, posting the highest incremental margins in the group along with one of the best free cash flow conversion rates, contends Barclays.