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Cactus (WHD): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q3 2026, to Sep 30, 2026, filed Oct 30, 2026; rules v1.1
Cactus (WHD): 1 rule of 10 triggered on the filings to Sep 30, 2026: receivables growing = future cash is certain. 2 to review; 5 with insufficient data; 2 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Receivables growing = future cash is certain Triggered · severity high · confidence medium
Receivables grew 151% year over year in Q3 2026 against revenue growth of 63%, and the quarter before 146% against 64%; days sales outstanding is 109 against a median of 71 over the eight quarters before. More of each quarter's revenue is still owed by customers.
Innocent reading: Seasonality: a quarter that always ends with big shipments.
Low P/E at a cyclical peak = undervalued To review · confidence medium
Net income of $184M is at a high against a median of $110M over eight years; at 23.9× the market is not pricing it as cheap, but a multiple on this year's profit still understates the mid-cycle one (40.0×).
A precise DCF value = the true value To review · confidence high
The DCF's point value is 88.19 a share (price 58.12); 62% of it is the terminal value, a number about years no one has seen. Moving revenue growth (each year) by ±5 pts alone takes it from 74.82 to 103.65; across every method the research ran the range is 4 to 242. The value is a range; the decimals are not information.
Innocent reading: A stable, mature business with a narrow range of outcomes, where the point value is a fair summary.
Every rule
A01 FCF growth = the business improved Insufficient data
fewer than two fiscal years with operating cash flow and capital expenditure on file
A07 Stock compensation added back = no economic cost Insufficient data
fewer than two fiscal years of stock compensation and share counts on file
B02 Receivables growing = future cash is certain Triggered severity high · confidence medium
Receivables grew 151% year over year in Q3 2026 against revenue growth of 63%, and the quarter before 146% against 64%; days sales outstanding is 109 against a median of 71 over the eight quarters before. More of each quarter's revenue is still owed by customers.
The figures and how they are read
| Quarter | Q3 2026 |
| Revenue, year over year | +63.2% |
| Receivables, year over year | +151.4% |
| Quarter before | Q2 2026 |
| Revenue y/y, quarter before | +64.3% |
| Receivables y/y, quarter before | +146.1% |
| Days sales outstanding | 108.5 |
| DSO, median of eight quarters | 71.0 |
| Receivables | $506M |
| Revenue | $431M |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q3 2026 (receivables and revenue) · Q3 2025 (the same quarter a year earlier)
What would explain it innocently
- Seasonality: a quarter that always ends with big shipments
- An acquisition brought its own receivables
- New business with longer standard terms (government, large enterprise)
- Currency: receivables booked in a strengthening currency
What to look for in the filing
- The receivables ageing and the allowance for credit losses
- Any factoring or receivables sold (and whether with recourse)
- Credit terms by customer group
What would show the trap does not apply
- Receivables fall back in line with revenue in the next quarter and DSO returns to its history
- The 10-Q attributes the increase to a disclosed one-off (a large customer's timing, an acquisition) and the allowance for doubtful accounts did not rise
Look again: next filing.
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Insufficient data
no debt figure could be read from the balance sheet (the filing may tag it in other lines)
D03 EPS growth = profit growth Insufficient data
no quarter with EPS, net income and diluted shares for both this year and last
E02 Low P/E at a cyclical peak = undervalued To review confidence medium
Net income of $184M is at a high against a median of $110M over eight years; at 23.9× the market is not pricing it as cheap, but a multiple on this year's profit still understates the mid-cycle one (40.0×).
The figures and how they are read
| market value | $4.4B |
| net income ttm | $184M |
| pe ttm | 23.90 |
| net income median fy | $110M |
| pe mid cycle | 40.00 |
| net income peak fy | $185M |
| years | FY2018 / 52.0; FY2019 / 86.0; FY2020 / 34.0; FY2021 / 50.0; FY2022 / 110.0; FY2023 / 169.0; FY2024 / 185.0; FY2025 / 166.0 |
| down years in window | 2 |
P/E on the trailing twelve months' net income against the P/E on the median net income of the last eight fiscal years (a mid-cycle stand-in); 'at a peak' = this year's profit at or above 90% of the best year and at least 1.3× the median
Source: Q3 2026 (net income, trailing twelve months)
What would show the trap does not apply
- Profit holds at this level through the next two years (the eight-year peak was a new base, not a top)
- The industry's capacity and prices stay where they are rather than reverting
Look again: next filing.
E07 A precise DCF value = the true value To review confidence high
The DCF's point value is 88.19 a share (price 58.12); 62% of it is the terminal value, a number about years no one has seen. Moving revenue growth (each year) by ±5 pts alone takes it from 74.82 to 103.65; across every method the research ran the range is 4 to 242. The value is a range; the decimals are not information.
The figures and how they are read
| dcf value | 88.19 |
| price | 58.12 |
| terminal value share | +62.4% |
| swing by input | Revenue growth (each year) / ±5 pts / 74.82 / 103.65; Operating margin / ±3 pts / 75.84 / 100.53; WACC / ±1 pt / 79.62 / 98.91; Tax rate / ±5 pts / 83.17 / 93.2 |
| range all methods | 3.71; 241.76 |
the DCF's point value against the share of it that is the terminal value and the value at each input moved by one step (growth ±5 pts, WACC ±1 pt, margin ±3 pts …); the range across every method the research ran
Source: 2026-11-08 (valuation research)
What would explain it innocently
- A stable, mature business with a narrow range of outcomes, where the point value is a fair summary
- The inputs that matter most are themselves well known (a regulated return, a long contract)
What to look for in the filing
- Which input you believe differs from the research's and why
- What the price implies for growth (the reverse DCF on the fair-value page)
What would show the trap does not apply
- The DCF's value is robust to the terminal growth and discount rate (the range's low end is still above the price)
- The company's cash flows over the next three years track the DCF's early years
Look again: next filing.
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Cactus: cash flow →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.