Innovex International, Inc.

Well-capitalized oilfield-equipment maker with a 'Big Impact, Small Ticket' consumables model and a fortress balance sheet.

Strengths

• Top-decile liquidity (current 4.9x, quick 3.2x) and interest coverage 51x (95th pct); gross margin 31% (75th pct)
• Strong ROA (80th pct), conservative leverage, and disciplined accretive M&A (Citadel, DWS, SCF)

Risks

• Earnings are highly cyclical and tied to oil & gas drilling activity, which softened in 2025
• ROE only 7.9% (60th pct) and operating margin 13.6% are good rather than dominant

Notable findings

• Customer concentration~52% of revenue from one customer/distributor — We are a global company, a nd for the year ended December 31, 2025, the NAM market made up approximately 52% of our revenue, while the International and Offshore markets constituted 48%
• Buying back stockNet buyback — share count -3%/yr over 4y
• Revenue declineRevenue -12.6% YoY
• China exposure• export controls, economic sanctions, embargoes, anti-boycott regulations, import controls, duties and tariffs, and other trade restrictions; • the imposition of duties and tariffs and other trade
• Insider sellingInsider selling — 17 open-market sale(s) by 4 insider(s) (cluster of 4 insiders, ~$327M, last 6mo) Form 4 ↗