FTK · Flotek Industries
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $29.87
Note written ·
Price against the kill line
15.2% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $29.87, on record since 11 November 2026. The shares are down 11.6% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $29.87, which would retake the roughly $29.80 level where the shares opened on 4 November 2026 and show them leading the S&P 500. A fourth-quarter Data Analytics revenue figure above Q2's record $19.2 million would also show the call wrong.
Research onlyNot in the portfolio.
Key figures from the filings · Materials
Quarter to 30 September 2026, filed 6 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 114
- Revenue, change on a year (%)
- +104.1
- Gross margin (%)
- 24.0
- Operating margin (%)
- 15.7
- Net cash, cash less debt ($M)
- 13.3
- Price to earnings (×)
- 29.7
- Enterprise value to sales (×)
- 2.6
- Enterprise value to operating income (×)
- 19.5
All filed numbers
What Flotek Industries reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 114 | +104.1 | 24.0 | 15.7 |
| first filed | 99.4 | +70.3 | 23.9 | 15.0 |
| first filed | 70.1 | +26.5 | 22.2 | 10.8 |
| first filed | 67.5 | +33.0 | 22.5 | 8.9 |
| first filed | 56.0 | +12.6 | 31.7 | 16.2 |
| first filed | 58.4 | +26.4 | 24.7 | 4.4 |
| Pre-tax income ($M) | 16.4 |
| Net income ($M) four quarters: 30.9 | 13.3 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | +1.4 |
| Operating cash flow ($M) | −10.6 |
| Capital spending ($M) | Not reported |
| Free cash flow ($M) | Not available |
| Cash and short-term investments ($M) | 21.3 |
| Debt ($M) credit line | 7.9 |
| Net cash, cash less debt ($M) | 13.3 |
| Deferred revenue ($M) | 1.3 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | Not reported |
| Inventory ($M) | 33.7 |
| Shareholders' equity ($M) | 144 |
| Market value ($M) | 919 |
| Enterprise value, market value plus net debt ($M) | 906 |
| Enterprise value to sales (×) | 2.6 |
| Enterprise value to operating income (×) | 19.5 |
| Price to earnings (×) | 29.7 |
| Price to book value (×) | 6.4 |
| Free-cash-flow yield (%) | Not available |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 11.7% of shares outstanding sold short, 9.1 days of average trading to cover, +11.1% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $34.3M | $60.0M |
| 12 monthsfrom | $34.3M | $60.4M |
The thesis
Flotek Industries' shares look more likely to lag the S&P 500 than lead it over the next three months. International chemistry carried the third-quarter beat, but the Data Analytics segment, the higher-margin half of the case, shrank, and the next quarterly report falls after the three-month window.
Third-quarter revenue was $114.4 million, up 104% from a year earlier, and full-year 2026 revenue guidance rose to $382–390 million from $360–370 million, per the company's 8-K of 3 November 2026. Data Analytics revenue was $18.1 million, against $19.2 million in Q2. Fourth-quarter results, estimated for March 2027, settle whether analytics grows again without its Montana power contract.
The shares gapped to about $29.80 at the open on 4 November 2026, per MarketBeat, and closed that day at $24.72. They fell to $22.16 on 5 November 2026 and recovered to $26.43 by 11 November 2026. Company news through 11 November 2026 shows no downgrade or equity offering behind the 5 November 2026 drop. The Form 10-Q was filed on 6 November 2026.
Bullish and bearish views on Flotek Industries, Inc.
The bull case on Flotek Industries, Inc. (FTK), in brief: third guidance raise of 2026. The bear case: Analytics revenue fell.
Bull case
- Third guidance raise of 2026. Flotek lifted FY2026 revenue guidance to $382–390 million from $360–370 million on 3 November 2026. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance rose to $59–62 million from $50–54 million.
- Results beat estimates widely. Q3 revenue of $114.352 million topped a $93.533 million estimate, and earnings per share of $0.34 topped a $0.20 estimate, per Benzinga on 3 November 2026. Adjusted EBITDA was $19.5 million, up 87% from a year earlier, per the company release.
- International chemistry delivered. International chemistry revenue was $28.4 million in Q3, against $2.2 million a year earlier, per the 3 November 2026 release. The chief financial officer forecast Q4 at similar levels on the 4 November 2026 call.
- Outside analytics customers are growing. External Data Analytics revenue rose to $11 million from $2.8 million a year earlier, per the 4 November 2026 call. The segment earned 45% of Q3 gross profit on 16% of revenue.
- 2027 analytics spending has funding. Flotek plans $15–20 million of Data Analytics capital spending in 2027, partly funded by the September term loan, per the 3 November 2026 release. The chief financial officer put leverage below one times on the 4 November 2026 call.
- Analyst targets sit above the price. Investing.com listed analyst targets of $32 to $44 in its 4 November 2026 call coverage.
Bear case
- Analytics revenue fell. Data Analytics revenue was $18.1 million in Q3 against $19.2 million in Q2, per the company's releases of 3 November 2026 and 4 August 2026. Its share of gross profit fell to 45% from 51%.
- The Montana power contract has lapsed. Its initial term expired in September, and the chief financial officer said on 4 November 2026 that guidance assumes no Q4 revenue from it. Analytics growth now rests on other contracts and on Digital Valuation, about 9% of Q3 segment revenue on the call.
- Guidance points to a softer Q4. Nine-month revenue was $283.8 million and nine-month adjusted EBITDA was $45.4 million, per the 3 November 2026 release. Earnings Whispers calculates implied Q4 revenue of roughly $98–106 million from the new guidance range.
- Related-party revenue is half of sales. Related-party revenue was $57.4 million of Q3's $114.4 million, and related-party chemistry revenue was $50.3 million, per the release. Chief Executive Ryan Ezell expects North American land activity to be flat to down in 2027.
- Margins and cash flow are weaker. Q3 gross profit was $27.4 million, 24% of revenue against 32% a year earlier, per the 8-K. Nine-month operating cash flow was negative $16.8 million, and cash was $21.3 million on 30 September 2026.
- Puerto Rico legal questions remain open. The securities class action covers buyers from 3 August to 17 August 2026, and its lead-plaintiff deadline was 26 October 2026, per a Levi & Korsinsky release. Flotek's 8-K of 19 August 2026 disclosed a law-enforcement referral by Puerto Rico's Oversight Board.
Price setup
The shares closed at $26.43 on 11 November 2026. That is 33.4% below the 52-week intraday high of $39.67 set on 12 August 2026, and the 3-month change is −23.2%. The 52-week closing low is $13.47 on 20 November 2025.
The 50-day average is $26.65 and the 200-day average is $22.35, both as of the 11 November 2026 close. The last close sits just under the 50-day average and about $4 above the 200-day. The 5 November 2026 close of $22.16 was the post-earnings low among recent closes, and it was marginally under today's 200-day average.
Closes since the report were $24.72 on 4 November 2026, $22.16 on 5 November 2026, $24.45 on 6 November 2026, $25.98 on 9 November 2026 and $25.47 on 10 November 2026. The roughly $29.80 opening price of 4 November 2026 is the nearest reference above the price.
SEC Form 4 filings show Chief Executive Ryan Ezell and Chief Financial Officer James Bond had shares withheld for tax at $25.35 on 30 October 2026. Director Matthew Wilks bought 1,319,493 shares at $26.01 on 11 September 2026, and ProFrac GDM, a 10% owner, sold 2,306,806 shares at the same price and date. Wolfpack Research disclosed a short position in August 2026.
Catalysts ahead
- ~31 December 2026 (est.): Year-end due date for four new natural-gas distribution skids, three of them contracted. Deliveries help show whether Data Analytics can replace the lapsed Montana power revenue.
- ~10 March 2027 (est.): Q4 2026 results. Tests Data Analytics revenue against Q3's $18.1 million, international chemistry against Q3's $28.4 million, and full-year revenue against the $382–390 million guidance.
What would change the view
A daily close above $29.87, which would retake the roughly $29.80 level where the shares opened on 4 November 2026 and show them leading the S&P 500. A fourth-quarter Data Analytics revenue figure above Q2's record $19.2 million would also show the call wrong.
What it trades with
Flotek's revenue has three drivers. North American pressure-pumping activity reaches it through ProFrac, with $50.3 million of related-party chemistry revenue in Q3. Middle East unconventional gas reaches it through international chemistry, which management tied on the 4 November 2026 call to Aramco's technology group and the Jafurah gas play.
Power demand reaches it through PWRtek. Management reported 41 skids deployed, 25 to 28 of them with ProFrac, and expects 1 gigawatt of added power support by Q1 2027. The shares' link to US shale activity looks likely to loosen as international chemistry grows. Q4 international chemistry falling back toward Q2's $10.6 million would show that view wrong.
The evidence, claim by claim (8)
- Q3 2026 total revenue was $114.4 million, up 104% from $56 million a year earlier; diluted earnings per share were $0.34 and adjusted EBITDA was $19.5 million. Flotek Q3 2026 release, exhibit 99.1 to 8-K · as of
- Flotek raised FY2026 revenue guidance to $382–390 million from $360–370 million and adjusted EBITDA guidance to $59–62 million from $50–54 million. Flotek Q3 2026 release, exhibit 99.1 to 8-K · as of
- Q3 2026 Data Analytics revenue was $18.1 million, against a record $19.2 million in Q2; the segment earned 45% of Q3 gross profit versus 51% in Q2. Flotek Q3 and Q2 2026 releases, exhibit 99.1 to 8-K · as of
- Q3 2026 international chemistry revenue was $28.4 million, up from $2.2 million a year earlier; the chief financial officer forecast Q4 at similar levels. Flotek Q3 2026 release; 4 November 2026 earnings call · as of
- Related-party revenue was $57.4 million in Q3 2026; related-party chemistry revenue was $50.3 million, the first quarter above $50 million under the ProFrac supply agreement. Flotek Q3 2026 release, exhibit 99.1 to 8-K · as of
- The initial term of Flotek's Montana power services contract expired in September 2026, and FY2026 guidance assumes no fourth-quarter revenue from it. 4 November 2026 earnings call transcript · as of
- Nine-month 2026 operating cash flow was negative $16.8 million; cash was $21.3 million on 30 September 2026. Flotek Q3 2026 release, exhibit 99.1 to 8-K · as of
- Director Matthew Wilks bought 1,319,493 shares and ProFrac GDM, a 10% owner, sold 2,306,806 shares, both at $26.01 on 11 September 2026. SEC Form 4 filings dated 15 September 2026 · as of
Sources
- FLOTEK INDUSTRIES INC/CN/ - Form 8-K - FY2026 · sec.gov ·
- Earnings call transcript: Flotek beats Q3 2026 estimates, raises outlook · in.investing.com
- Flotek beats and raises again on a Saudi chemistry surge but the data analytics growth story lost some shine · finviz.com
- FLOTEK INDUSTRIES INC/CN/ - Form 8-K - FY2026 · sec.gov
- Flotek Industries (NYSE:FTK) Shares Gap Up on Strong Earnings · marketbeat.com ·
- Earnings Whispers
- FTK Shareholder Alert: October 26, 2026 Lead Plaintiff Deadline in Flotek Industries, Inc. Securities Class Action - Contact Levi & Korsinsky · globenewswire.com ·
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