Here’s Why Greenlight Capital Acquired Weatherford International (WFRD) Shares

Greenlight Capital, an investment management firm, published its first-quarter 2022 investor letter – a copy of which can be downloaded here. The Greenlight Capital funds (the “Partnerships”) returned 4.4%1 in the first quarter of 2022, compared to a 4.6% decline for the S&P 500 index. Try to spend some time taking a look at the fund’s top 5 holdings to be informed about their best picks for 2022.

In its Q1 2022 investor letter, Greenlight Capital mentioned Weatherford International plc (NASDAQ:WFRD) and explained its insights for the company. Founded in 1941, Weatherford International plc (NASDAQ:WFRD)  is a Houston, Texas-based drilling oil and gas wells company with a $2.5 billion market capitalization. Weatherford International plc (NASDAQ:WFRD)  delivered a 32.54% return since the beginning of the year, while its 12-month returns are up by 258.79%. The stock closed at $36.74 per share on April 21, 2022.

Here is what Greenlight Capital has to say about Weatherford International plc (NASDAQ:WFRD) in its Q1 2022 investor letter:

“WFRD is a global oilfield services company that provides drilling tools and other products and services required to produce oil and gas. Due to poor execution and a lot of debt, the company went bankrupt in 2019. It has since emerged as a less levered, better managed, and cashflow generating business. WFRD now has the wind at its back as many years of underinvestment in exploration and production have left the world structurally short of oil. The company stands to benefit from the significant increase in exploration and production capex that is underway. We acquired WFRD shares at an average cost of $32.27, or 5x EV/2022 EBITDA, while its three largest peers trade between 11x and 13x EV/2022 EBITDA. WFRD shares ended the quarter at $33.30.”

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Our calculations show that Weatherford International plc (NASDAQ:WFRD) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Weatherford International plc (NASDAQ:WFRD) was in 17 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 9 funds in the previous quarter. Weatherford International plc (NASDAQ:WFRD) delivered a 25.31% return in the past 3 months.

In November 2021, we published an article that includes Weatherford International plc (NASDAQ:WFRD) in 5 Reddit Stocks that Tripled in 2021. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.