Saurabh Sud of T. Rowe Price presented his in-depth investment thesis on Liberty Oilfield Services (US: LBRT) at Best Ideas 2020.

Thesis summary:

Liberty Oilfield Services is an oilfield service company that specializes in hydraulic fracturing, stimulation, and engineering services. The company has grown from one active hydraulic fracturing fleet in December 2011 to 23 fleets at the end of September 2019. This is a commoditized business with high cyclicality and significant capital intensity. However, LBRT is the best player in the space, with leading operational execution (EBITDA to Hydraulic Horse Power), strong emphasis on technology, good customer relationships, and an impressive management team. Saurabh sees low downside for the shares, as they recently traded close to replacement cost.

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About the instructor:

Saurabh Sud is a senior portfolio manager in the Fixed Income division of T. Rowe Price, with specific expertise in credit markets. Previously, Saurabh spent about six years with PIMCO, including as senior vice president of portfolio management. He holds a B.Tech in electrical engineering from Indian Institute of Technology in Delhi and an MBA in finance from Columbia Business School.