Weatherford's (WFT +9.7%) cancellation of its plans to raise $1B in a stock and debt offering is good news for the company, Jefferies analyst Brad Handler says as he reaffirms his Buy rating on the stock.
The analyst says "the 'on paper' benefit of adding drill bits and upgrading Weatherford's directional drilling capabilities/platform, and that Weatherford's global footprint points to meaningful synergies... yet more important for us was the risk of further dilution for equity holders."
The money could have been used to buy assets from Halliburton (HAL +0.2%) as it tries to acquire Baker Hughes (BHI -0.6%); WFT's apparent withdrawal means that GE (GE -0.2%) could be the only player left that can afford the assets.
But the conflicting announcements from WFT are a "blow to management credibility," analysts at Tudor Pickering say.
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