Tetra Technologies Inc (NYSE: TTI)

Sector: Industrials Industry: Conglomerates CIK: 0000844965
Market Cap 1.44 Bn
P/B 4.85
P/E 11.77
P/S 2.33
ROIC (Qtr) 6.12
Div Yield % 0.00
Rev 1y % (Qtr) 8.14
Total Debt (Qtr) 214.60 Mn
Debt/Equity (Qtr) 0.72
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About

TETRA Technologies, Inc., often referred to as TTI, operates in the energy services and solutions industry. The company's main business activities encompass providing products and services to the oil and gas industry, as well as calcium chloride and other chemicals for various applications. TTI's operations span across the United States and extend to international markets. TTI generates revenue through its two primary divisions: the Completion Fluids & Products Division and the Water & Flowback Services Division. The Completion Fluids & Products...

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Investment thesis

Bull case

  • Healthy cash reserves of 67.20M provide 6.33x coverage of short-term debt 10.61M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 632.83M provides 2.95x coverage of total debt 214.60M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 74.27M provides strong 10.64x coverage of stock compensation 6.98M, indicating sustainable incentive practices.
  • Robust tangible asset base of 632.83M provides 3.50x coverage of working capital 180.59M, indicating strong operational backing.
  • Tangible assets of 632.83M provide robust 8.07x coverage of other current liabilities 78.42M, indicating strong asset backing.

Bear case

  • Operating cash flow of 74.27M barely covers its investment activities of (48.64M), with a coverage ratio of -1.53, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 74.27M provides minimal -0.91x coverage of tax expenses of (81.72M), suggesting potential tax planning inefficiencies or unsustainable tax positions.
  • Free cash flow of 6.80M provides weak coverage of capital expenditures of 67.47M, with a 0.10 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 59.11M show weak coverage of depreciation charges of 37.19M, with a 1.59 ratio indicating high capital intensity and potential reinvestment needs.
  • High depreciation of 37.19M relative to operating cash flow of 74.27M, which is 0.50x suggests significant maintenance capital requirements affecting free cash flow.

Consolidation Items Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Conglomerates
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 HON Honeywell International Inc 155.07 Bn 32.79 4.14 34.58 Bn
2 MMM 3M Co 100.16 Bn 20.62 3.16 12.60 Bn
3 VMI Valmont Industries Inc 11.52 Bn 79.14 5.93 0.86 Bn
4 SEB Seaboard Corp /De/ 4.74 Bn 9.55 0.49 1.82 Bn
5 MDU Mdu Resources Group Inc 3.80 Bn 15.84 0.97 2.35 Bn
6 OTTR Otter Tail Corp 3.60 Bn 20.35 3.01 1.04 Bn
7 BBU Brookfield Business Partners L.P. 2.64 Bn -19.71 0.10 43.31 Bn
8 TTI Tetra Technologies Inc 1.44 Bn 11.77 2.33 0.21 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.42 1.07
EV to Cash from Ops. EV/CFO 21.37 26.27
EV to Debt EV to Debt 7.40 3.17
EV to EBIT EV/EBIT 26.85 28.37
EV to EBITDA EV/EBITDA 16.18 2.98
EV to Free Cash Flow [EV/FCF] EV/FCF 233.38 24.12
EV to Market Cap EV to Market Cap 1.10 2.07
EV to Revenue EV/Rev 2.56 3.10
Price to Book Value [P/B] P/B 4.85 0.16
Price to Earnings [P/E] P/E 11.77 -51.36
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 2.51
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 16.94
Dividend per Basic Share Div per Share (Qtr) 0.00 1.03
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 -1.97
Interest Coverage Int. cover (Qtr) 3.18 4.08
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -49.78 -245.15
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 37.10 116.15
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -1.11
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 3,620.99 233.90
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 24.95 6.29
EBIT Growth (1y) % EBIT 1y % (Qtr) 68.16 58.90
EBT Growth (1y) % EBT 1y % (Qtr) 230.96 -70.32
EPS Growth (1y) % EPS 1y % (Qtr) 4,500.00 179.10
FCF Growth (1y) % FCF 1y % (Qtr) 44.22 22.76
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 14.17 19.56
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.94 0.64
Cash Payout Ratio Cash Payout (Qtr) 0.00 -0.01
Cash Ratio Cash Ratio (Qtr) 0.50 0.34
Current Ratio Curr Ratio (Qtr) 2.36 1.70
Debt to Equity Ratio Debt/Equity (Qtr) 0.72 -5.62
Interest Cover Ratio Int Coverage (Qtr) 3.18 4.08
Times Interest Earned Times Interest Earned (Qtr) 3.18 4.08
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 15.60 -14.03
EBIT Margin % EBIT Margin % (Qtr) 9.55 -16.67
EBT Margin % EBT Margin % (Qtr) 6.55 -20.17
Gross Margin % Gross Margin % (Qtr) 25.60 21.90
Net Profit Margin % Net Margin % (Qtr) 19.80 -21.67