Cactus

None of the warning signs we check for were found.

We look for five warning signs: doubt it can keep going, weak checks on its own accounts, a notice that its past accounts can't be relied on, a change of auditor, and one customer bringing in a big share of sales. We don't check lawsuits, investigations or debt yet.

We checked the auditor's report, internal controls, restatement notices, auditor changes and big customers in the 10-K filed 26 Feb 2026, plus the 10-Q filed 31 Jul 2026 and 7 later 8-Ks.

Cheap for a reason is the question the numbers cannot answer.

Whether the price already reflects the risks is what the deep dive is for.

• The Baker Hughes Transaction represents an expansion outside of our current geographic regions, and we may encounter new obstacles operating in different geographic regions.

  Could happen

  Prior to the Baker Hughes Transaction, our operations historically focused on the United States. The Baker Hughes Transaction represents an expansion of our operations in the Middle East and other jurisdictions. Certain aspects related to operating in these new jurisdictions may not be as familiar to us as the jurisdictions in which we operated prior to the Baker Hughes Transaction. As a result, we may encounter obstacles that may cause us not to achieve the expected results of the Baker Hughes Transaction. These obstacles may include a less familiar and more volatile geopolitical landscape, new customers with whom we have no established relationship and just a small number of which account for the preponderance of the Joint Venture’s revenue, pressure from local governments to hire local associates, use local suppliers or to direct business to nationalized companies, unfamiliar operating conditions, and a distinct regulatory environment. Our future success will depend, in part, upon our ability to manage this expanded business, which may pose substantial challenges for management, including challenges related to the management and monitoring of new operations and jurisdictions and associated increased costs and complexity. We may also face increased scrutiny from governmental authorities as a result of the increase in the size of our business. Any adverse conditions, regulations or developments related to our expansion into or within these new jurisdictions may have a negative impact on our business, financial condition and results of operations.

  Read moreShow less

• We may be required to acquire Baker Hughes Company’s interests in the Joint Venture.

  Could happen

  Generally beginning on January 1, 2028, the Baker Member has the right to sell to either the Joint Venture or the Cactus Member, and the Joint Venture or the Cactus Member, as applicable, shall be obligated to purchase all of the Membership Interests held by Baker Hughes Company (the “Put Right”). The purchase price (the “Exit Price”) will be based on an enterprise value of the Joint Venture using a multiple of six times its TTM Adjusted EBITDA (as defined and calculated in the Joint Venture LLC Agreement), subject to a maximum valuation of $660.0 million. If the Baker Member exercises the Put Right, we may not have sufficient liquidity to fund the Exit Price. We may be required to access external financing, and we may be unable to do so on favorable terms, or at all. Accordingly, our obligation to fund the Exit Price may adversely affect our liquidity and cause us to enter into financing arrangements with terms that are unfavorable to us.

  Read moreShow less

• The Joint Venture LLC Agreement restricts certain of our or the Joint Venture’s actions.

  Could happen

  For so long as Baker Hughes Company owns interests in the Joint Venture, we must, subject to certain exceptions, cause the Joint Venture to operate its business in the ordinary course consistent with past practice and not take certain actions that could reasonably be expected to reduce the Exit Price. Certain significant actions of the Joint Venture require the approval of Baker Hughes Company. Such restrictions may limit the ability of the Joint Venture to take actions that we believe to be beneficial to our business, results of operations and financial condition, or those of the Joint Venture. It is possible that disputes arise between us and Baker Hughes Company concerning our operation of the Joint Venture and such disputes could adversely affect our business and financial performance.

  Read moreShow less

• The Joint Venture LLC Agreement restricts certain of our or the Joint Venture’s actions.

  Could happen

  For so long as Baker Hughes Company owns interests in the Joint Venture, we are required to conduct the surface pressure control business in the countries where the Acquired Business operated prior to our acquisition only through the Joint Venture, subject to certain exceptions. These restrictions mean that certain new opportunities will be directed to the Joint Venture and not us, which may reduce the direct benefit that we receive from such new opportunities.

  Read moreShow less

• We may experience difficulties in integrating the operations of the Joint Venture into our business.

  Could happen

  The success of the Baker Hughes Transaction depends in part on our ability to successfully integrate the operations of the Joint Venture into our business. The integration process could take longer than anticipated and could result in the loss of key employees from the Company and/or the Joint Venture, the disruption of the Company’s and/or the Joint Venture’s ongoing businesses, tax costs or inefficiencies, or inconsistencies in standards, controls, information technology systems, procedures or policies, any of which could adversely affect our ability to maintain relationships with customers, employees or other third parties, or our ability to achieve the anticipated benefits of the Baker Hughes Transaction, and could harm our financial performance. Prior to the Baker Hughes Transaction, we did not have any significant infrastructure in most of the countries where the Joint Venture is doing business. As a result, Baker Hughes Company is providing the Joint Venture with limited transition services. If Baker Hughes Company fails to continue providing these transition services, or if we are unable to successfully or timely integrate and support the operations of the Joint Venture, we may incur unanticipated liabilities and be unable to realize the revenue growth, synergies and other anticipated benefits resulting from the Baker Hughes Transaction, and our business, results of operations and financial condition could be materially and adversely affected.

  Read moreShow less