HLX

Helix is a cyclical offshore energy-services play (well intervention, robotics, decommissioning) caught in a clear downcycle: FY2025 revenue fell 4.9% to $1.29B, operating income dropped 48.9% to $65.1M, and diluted EPS fell 41.7% to $0.21. Management is candid about the cause — commodity prices fell 20% in 2025, customers pushed spending into 2026, and a 'supply and demand imbalance for offshore vessels' has pressured utilization and day rates in the North Sea and Gulf of America. On reported earnings the stock looks dear at a 41.5x P/E, and the auditor flagged property-and-equipment impairment triggering events on a $1.4B asset base as the critical audit matter. That is the bear case, and it is real.

But the trough earnings mask a far more attractive asset-and-cash-flow valuation. At $8.71 the $1.28B market cap sits below the $1.58B of stockholders' equity (P/B ≈ 0.8x), and the balance sheet is a fortress: $445M cash (up 21%) against ~$308M total debt is a net-cash position, with a 2.75x current ratio and liabilities/equity of just 0.66x. D&A of $187M dwarfs the $65.1M of operating income, so the company still threw off $137M of operating cash flow against only $16.3M of capex — roughly $120M of free cash flow, a high-single-digit FCF yield, even at the bottom of the cycle. You are paying below book value for a net-cash business generating real free cash while its end-market is depressed.