WTTR

Select Water Solutions’ second quarter results were met with a significant positive market reaction, as management attributed the performance to strong revenue and profit growth across all three operating segments. CEO John Schmitz highlighted record revenue and gross profit in both the Water Infrastructure and Chemical Technologies divisions, driven by increased produced water volumes, improved skim oil recovery, and greater demand for high-spec chemical products. Management also pointed to strategic acquisitions and new contracts, particularly a large minimum volume commitment in the Northern Delaware Basin, as key contributors to the quarter’s momentum. Is now the time to buy WTTR? Find out in our full research report (it’s free). Revenue: $395.8 million vs analyst estimates of $374.5 million (8.7% year-on-year growth, 5.7% beat) Adjusted EPS: $0.24 vs analyst estimates of $0.12 (significant beat) Adjusted EBITDA: $92.75 million vs analyst estimates of $78.48 million (23.4% margin, 18.2% beat) Operating Margin: 8.7%, up from 4.2% in the same quarter last year Market Capitalization: $2.69 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. James Rollyson (Raymond James) asked about the sustainability of double-digit infrastructure growth. CFO Chris George confirmed that current project momentum supports ongoing double-digit growth into 2027, with additional project wins and bolt-on acquisitions expected to add to this trajectory. Robert Brooks (Northland Capital Markets) inquired if year-to-date results benefitted from right-of-first-refusal (ROFR) acres. EVP Michael Skarke clarified that there had not been material conversions yet, but future upside is expected as system utilization increases and more ROFR acres become active. James Larkin (Bank of America) questioned the drivers of Water Infrastructure’s volume growth in the next quarter. CEO John Schmitz explained that both new facility startups and increased commercialization of existing assets will contribute, with commodity price variability also affecting skim oil revenue. Donald Crist (Johnson Rice) asked about customer activity trends and basin diversification. Schmitz responded that increased completion intensity and drilling in the Haynesville and Bakken are providing tailwinds, while Select’s multi-basin infrastructure provides flexibility to capture growth beyond the Permian. Jeffrey Robertson (Water Tower Research) requested detail on pipeline utilization and the impact of new SWDs on margins. Skarke stated that greater throughput through existing infrastructure yields higher incremental margins, and the ability to tie in additional disposal assets increases capacity reliability and margin potential. Looking ahead, our analysts will be watching (1) the pace of new water infrastructure contract wins and system utilization, (2) adoption rates of specialty chemical products, particularly surfactants, and (3) execution on mineral extraction projects and their contribution to margin expansion in 2027. Additional attention will be given to the company’s ability to scale data center water solutions and manage capital investments for long-term free cash flow. Select Water Solutions currently trades at $20.92, up from $18.50 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies. Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Select Water Solutions, Inc. reported past second-quarter 2026 results showing sales of US$101.61 million and net income of US$21.04 million, both higher than a year earlier, with diluted EPS from continuing operations rising to US$0.17. For the first half of 2026, revenue reached US$761.77 million and net income was US$29.64 million, reflecting improved profitability versus the prior-year period. Beyond the headline growth, the quarter was underpinned by record performance in Water Infrastructure and Chemical Technologies, a new 7-year 128 million barrel minimum volume commitment contract, and the acquisition of 14 saltwater disposal wells, all of which reinforce the company’s scale and longer-term revenue visibility in US energy water management. We’ll now examine how these strong quarterly results and the long-term 7-year water agreement may reshape Select Water Solutions’ investment narrative. Capitalize on the AI infrastructure supercycle with our selection of the 57 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow. To own Select Water Solutions, you need to believe that long-term, contract-backed water infrastructure for U.S. oil and gas offers dependable cash flow despite sector uncertainty. The latest quarter’s stronger earnings and record Water Infrastructure and Chemical Technologies performance support this thesis and appear to strengthen the key near term catalyst of higher infrastructure utilization, while the biggest risk remains the company’s capital intensity if activity or contract wins slow. The most directly relevant development is the new 7 year, 128 million barrel minimum volume commitment, paired with the acquisition of 14 saltwater disposal wells. Together, they deepen Select’s footprint in key basins and increase visibility on future volumes, tying directly into the catalyst that its dedicated water networks and long term contracts could underpin more stable margins and earnings, even as shorter cycle Water Services activity remains more exposed to swings in producer spending. Yet beneath these strong numbers, investors should be aware that rising capital needs and customer concentration leave Select more exposed if activity suddenly shifts... Read the full narrative on Select Water Solutions (it's free!) Select Water Solutions' narrative projects $1.7 billion revenue and $78.6 million earnings by 2029. Uncover how Select Water Solutions' forecasts yield a $22.83 fair value, a 8% upside to its current price. Some of the most optimistic analysts were already modeling revenue near US$1.7 billion and earnings above US$130 million by 2029, and this quarter’s contract win directly challenges more cautious views about capital risk and customer dependence, so it is worth comparing how your expectations line up with both the bullish and more conservative scenarios. Explore 4 other fair value estimates on Select Water Solutions - why the stock might be worth just $21.00! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Select Water Solutions research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision. Our free Select Water Solutions research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Select Water Solutions' overall financial health at a glance. Every day counts. These free picks are already gaining attention. See them before the crowd does: The future of work is here. Discover the 39 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. The latest GPUs need a type of rare earth metal called Neodymium and there are only 28 companies in the world exploring or producing it. Find the list for free. We've uncovered the 8 dividend fortresses yielding 5%+ that don't just survive market storms, but thrive in them. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include WTTR. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 11:00 a.m. ET Vice President of Corporate Finance and Investor Relations - Garrett Williams Founder, Chairman, President and Chief Executive Officer - John Schmitz Executive Vice President and Chief Financial Officer - Chris George Executive Vice President and Chief Commercial Officer - Michael Skarke Executive Vice President and Chief Strategy and Technology Officer - Michael Lyons Operator: Greetings. Welcome to the Select Water Solutions 2026 Second Quarter Earnings Conference Call. Please note this conference is being recorded. I will now turn the conference over to Garrett Williams, Vice President of Corporate Finance and Investor Relations. Thank you, Garrett. You may begin. Garrett Williams Thank you, operator, and good morning, everyone. We appreciate you joining us for Select Water Solutions conference call and webcast to review our financial and operational results for the second quarter of 2026. With me today are John Schmitz, our Founder, Chairman, President and Chief Executive Officer; Chris George, Executive Vice President and Chief Financial Officer; Michael Skarke, Executive Vice President and Chief Commercial Officer; and Michael Lyons, Executive Vice President and Chief Strategy and Technology Officer. Before I turn the call over to John, I have a few housekeeping items to cover. A replay of today's call will be available by webcast and accessible from our website at selectwater.com. There will also be a recorded telephonic replay available until August 19, 2026. The access information for this replay was also included in yesterday's earnings release. Please note that the information reported on this call speaks only as of today, August 5, 2026, and therefore, time-sensitive information may no longer be accurate at the time of the replay listening or transcript reading. In addition, the comments made by management during this conference call may contain forward-looking statements within the meaning of the United States federal securities laws. These forward-looking statements reflect the current views of Select's management. However, various risks, uncertainties and contingencies could cause our actual performance or achievements to differ materially from those expressed in the statements made by management. The listener is encouraged to read our annual report on Form 10-K, our current reports on Form 8-K as well as our quarterly reports on Form 10-Q to understand those risks, uncertainties and contingencies. Please refer to our earnings announcement released yesterday for reconciliations of non-GAAP financial measures. Now I'd like to turn the call over to John. John Schmitz: Thanks, Garrett. Good morning, and thank you for joining us. I am pleased to be discussing Select Water Solutions again with you today. The second quarter of 2026 was a very strong quarter for Select. I'd like to start with some of the key second quarter highlights and other strategic and market updates. Then I'll hand it over to Chris to discuss the second quarter financial results and the forward outlook in more detail. In the second quarter, Select delivered strong overall performance across all 3 operating segments with both our Water Infrastructure and our Chemical Technologies segments producing record revenue and gross profit in the quarter. During the second quarter, on a consolidated basis, we increased revenue by 8%, increased adjusted EBITDA by 19% and more than doubled net income as compared to the first quarter of 2026. Our Water Infrastructure segment outpaced our guidance for the period delivering another quarter of revenue growth and margin improvement. Increased produced water volumes and improved skim oil recovery drove record quarterly revenue of $102 million for the segment in the second quarter. This results in 26% year-over-year growth in revenue for the segment relative to the second quarter of 2025, demonstrating the significant progress we've made with our water infrastructure growth strategy. We expect to see further growth in the third quarter, and we are well on track to achieve the upper end of our 25% to 30% full year growth guidance for the segment, setting the stage for additional run rate growth looking into 2027. While much has been accomplished, we continue to find new opportunities, both large and small, to further enhance the long-term potential value of our Northern Delaware network. We added several MVCs, acreage dedications and interruptible tie-in agreements during the quarter while also executing a new mineral extraction agreement with a new strategic partner for iodine extraction across the portfolio. Importantly, during the second quarter, we executed a new 7-year agreement with a large public operator in the Northern Delaware Basin, supported by a sizable 128 million barrel MVC contract. This agreement also included the conveyance of a portfolio of underutilized but strategic SWDs across Eddy and Lea County, New Mexico. We intend to tie these SWDs into our existing water infrastructure network and the full project associated with the large MVC award is expected to cost approximately $25 million to $30 million and to be operational within the next 12 months. The conveyance of these SWDs was largely enabled by the historical success of the full life cycle water management solutions we developed in collaboration with this operator, which increased their recycling volumes and decreased the utilization of their own operated disposal wells in the Northern Delaware. This reduced the operators' need for owning disposal wells in the region. This speaks to the value our integrated recycling and disposal infrastructure network brings to our customers and more broadly, to the Northern Delaware region. Ultimately, the customer views this disposal capacity as more valuable to them as part of Select's broader commercial platform than part of their own internal system. Select's comprehensive water management framework allows us to take a basin-wide approach to produced water disposal, treatment and supply to unlock value across the Northern Delaware Basin, and I believe there will continue to be opportunities to acquire existing assets that are scalable and synergistic with Select's ongoing organic infrastructure build-out. Water management is mission-critical to the energy industry and disposal remains an essential part of a comprehensive water management solution. We are proud of the increasing collaboration and commitment from our customers to grow our full life cycle and cost advantage solution in partnership together. Elsewhere, in our Chemical Technologies segment, we saw significant sequential and year-over-year improvement coming in well above our expectations. Our Chemical Technologies segment, in-basin manufacture, rapid new product development pace and steady field execution has driven market share gains. Furthermore, increased completion intensity and complexity and the growing interest in surfactant technology has driven increased demand for our higher spec and higher-margin product offerings. This contributed to record-setting Chemical Technologies revenue in the second quarter and despite increases to oil-based raw material input costs, we delivered margin gains in the quarter as well. Looking at our Water Services segment, we outperformed our expectations in the second quarter and have been pleased with the year-to-date performance of our last mile water logistics and delivery business. Looking at the macro outlook more broadly, the geopolitical and commodity price environment remains fluid. We believe the customer activity environment will remain supportive of continued solid performance and the more direct activity correlated offerings within our Water Services and Chemical Technologies segments. While our Water Infrastructure segment will continue to benefit from the strong secular tailwinds, a steady pace of new projects and a growing portfolio of contracted future inventory in the core of the Permian Basin. Overall, I am very pleased with the performance of the business year-to-date. With the support of a healthy balance sheet, we are well positioned to continue to invest in attractive growth opportunities in front of us in order to deliver long-term value to our customers, employees and stakeholders as we look ahead. At this point, I'll hand it over to Chris to speak to our financial results and outlook in a bit more detail. Chris? Chris George: Thank you, John, and good morning, everyone. Select made great strides in the second quarter, which included strong consolidated revenue, net income and adjusted EBITDA growth, another quarter of record adjusted EBITDA and consolidated gross margins before D&A, record Water Infrastructure and Chemical Technology revenues and ongoing strong performances in Water Services. Looking at our second quarter segment performance in more detail, we grew consolidated revenues to $396 million, net income to $23 million and adjusted EBITDA to $93 million. As John mentioned earlier, the Water Infrastructure segment delivered another positive quarter marked by top line revenue growth, margin expansion and incremental contract awards. We increased our produced water volumes handled to 1.5 million barrels per day and improved our skim oil capture alongside higher pricing, contributing to record revenues of $102 million and very strong 58% gross margins before D&A, outpacing our guided expectations. This represents a 5% increase in revenue and a 9% increase in gross profit before D&A as compared to the first quarter of 2026. Importantly, this equates to year-over-year growth in revenue and gross profit before D&A of 26% and 27%, respectively, relative to Q2 of 2025. As John noted, in the second quarter, we bolstered the outlook for our infrastructure business with the addition of several new infrastructure contracts, including a sizable MVC award in multiple dedications and interruptible tie-in opportunities across the Permian, Bakken, MidCon and Northeast regions. In addition to the 14 SWDs conveyed as part of the larger contract John outlined, we also acquired 2 separate SWDs in the Delaware Basin during the second quarter for a total of 16 new active SWDs added in the region. Separately, we also closed on the previously announced strategic surface acquisition of the Black River Ranch during the quarter. This multipurpose surface acquisition in Eddy County, New Mexico adds future infrastructure development opportunities, high-margin surface and mineral cash flows and long-term cost synergies to our existing network. Looking ahead to the third quarter, we anticipate 5% to 10% revenue growth for the segment and expect to sustain gross margins in the 56% to 58% range during Q3. This ongoing execution coupled with the outperformance in the first half of the year, leaves us well positioned to come in on the high end of our already increased full year guidance of 25% to 30% year-over-year growth for the segment. Switching over to Water Services. This segment saw revenues grow by approximately 4% sequentially, outpacing our guidance of a modest decline, driven by slightly improved activity levels and continued strength in our last mile logistics and rental offerings. Gross margins before D&A in Water Services increased to 23% during Q2, a solid improvement compared to 21.8% in the first quarter. We anticipate generally steady revenue levels for Water Services in the third quarter and forecast margins before D&A in the 20% to 22% range in Q3. Overall, we believe this segment is poised to participate in any activity upside and pricing opportunities that may arise if elevated commodity prices are sustained in the near term. Elsewhere, the Chemical Technologies segment posted a stellar second quarter with significant sequential revenue gains and meaningful outperformance relative to our prior forecast. Revenue of $96 million increased by 23% relative to Q1 of 2026 and gross margin before D&A of 20% combined to deliver 35% sequential growth in gross profit before D&A to $19.4 million in the second quarter of 2026. While we forecast a modest retrenchment to $85 million to $90 million of revenue based on current customer schedules forecasted for the third quarter, we continue to see healthy demand for our high-spec, higher-margin friction reducer and specialty surfactant product offerings. Accordingly, margins for the segment should remain in the 20% to 21% range. Overall, we remain very excited about the future opportunity set for this segment. On a consolidated basis, supported by meaningful gross profit gains and relatively steady SG&A, altogether, we generated consolidated adjusted EBITDA of $93 million during the second quarter of 2026, significantly above the high end of our guidance range of $77 million to $80 million, resulting from outperformance across all 3 segments. Looking forward into the third quarter, we expect continued strong performance across the business, resulting in adjusted EBITDA of $90 million to $94 million as Water Infrastructure growth is balanced against our near-term outlook for Water Services and Chemical Technologies. While we may see some modest seasonal impacts in the fourth quarter across parts of the business, we believe we are poised for continued year-over-year growth in 2027. Looking at our other costs, D&A expense should climb slightly in the third quarter to the $48 million to $52 million range as several capital projects are expected to be completed in the quarter. Net interest expense decreased sequentially in conjunction with reduced borrowings, and we expect interest to remain in the $4 million to $6 million range per quarter in the near term. On the operating cash flow side, we saw a meaningful improvement compared to Q1 with $87 million of operating cash flow generated in the quarter as we studied our working capital management compared to the prior build in Q1. On the investing side, we deployed $112 million towards a combination of CapEx and acquisitions in the second quarter, primarily in support of our water infrastructure business. In addition to the $70 million of net CapEx, as I mentioned earlier, we closed on $42 million of strategic bolt-ons for the water infrastructure business in the quarter as well as the buyout of several long-term facility leases for key operating locations. While the maintenance needs of the business remained steady around the $60 million range in support of our latest infrastructure contract awards and growth opportunities, we now expect net capital expenditures to increase to $250 million to $290 million in 2026, up from the $250 million high end of our prior guidance. As we continue to scale our core Northern Delaware water infrastructure network, the opportunity set in front of us has expanded with it, and we are confident in our ability to keep delivering accretive growth projects in the quarters ahead that will drive significant long-term value for our shareholders. Our leading customers in the Permian Basin continue to grow through consolidation, lease sales and successful exploratory well results and Select is geographically and operationally well positioned to benefit and participate in this growth with our customers. Overall, our business maintains a maintenance-light capital model, which has the ability to generate strong discretionary cash flow. We expect this discretionary cash flow to provide increasing optionality, especially as our Northern Delaware build-out matures over time. While this ongoing build phase will limit our free cash flow potential this year, we are establishing a tremendous portfolio of long-term contracted cash flows. We have an actively scaling infrastructure platform, which possesses room for significant utilization enhancement over time. Even with the potential for additional growth capital investment in 2027, resulting from a strong backlog of opportunities, this platform and our steadily growing earnings profile reinforces our confidence in improved free cash flow potential in 2027 and beyond. Overall, we are very pleased with the strong year-over-year trajectory across all parts of the business so far in 2026. While there is much left to do, I'm especially encouraged by the significant progress we've made with our water infrastructure growth strategy and the opportunity set in front of us remains robust. With that, I'll hand it over to the operator for any questions. Operator? Operator: Our first question is from Jim Rollyson with Raymond James. James Rollyson: Fabulous results again as usual. I don't know if this is for John or Chris, but if you kind of take the run rate you are on in Water Infrastructure to now hit the high end of the revised range of 30% growth in top line this year. And you kind of look at the momentum of projects you already have in hand, some of the recent deals you've done, how do you handicap the rate of growth we should be thinking about going into next year? It clearly seems like it's a double-digit number, but I kind of want to make sure we don't get the cart too far in front of the horse here as we think about the run rates. Chris George: Yes, Jim, -- so I think you're certainly thinking about it correct. As we sit here today, looking at the additional projects we've added to the to the recent win list as we think about what the opportunity set looks like for the rest of the back half of the year. Obviously, we're adding to the capital program in '26. I think we're pretty confident that we're going to continue to add to it for 2027. I think on a base case, as we sit here today, on a run rate, you're looking to execute on another year of double-digit growth into 2027. And I think we've got an opportunity set to continue to add to that profile with additional project wins and/or bolt-on acquisitions over the next couple of quarters. So we're pretty excited about the continued growth in the backlog and the opportunity set. We're pretty excited about the recent execution of the projects we have coming online here in Q3 that's setting up the stage for continued growth into 2027. And so hopefully, we can execute on that, build upon it. And certainly, as we sit here today, something that starts with double-digit growth in next year is how we would think about it. John Schmitz: Yes, that's Chris. And this is John. So the only thing I'd add to Chris' position is in the quarter, we announced what Michael and his team did with that operator. And for that operator to give us the amount of disposal wells because of the really game-changing application of recycle first. This network has become very important to the industry. into that area. And I think that it says a lot to the other piece of the system that we always talked about that we thought would get filled up with either commercial is the way we described it and now we're describing it as interruptible. And we -- that call volume and that action by that operator to give us those disposals to network this thing and continue to build it out is very powerful. Chris George: Yes. It's not an insignificant investment they made in those 14 SWDs, I suppose. James Rollyson: As a follow-up, maybe this is one for John, but kind of longer-term picture question that I'm going to take a shot at here. You're kind of on this run rate now, second quarter and third quarter guide of this low to mid-$90 million EBITDA run rate puts you well on track for the numbers that people have for next year and beyond. If you start adding up some of the smaller wins that aren't contributing today like the different minerals extraction royalty stream and your municipal water transaction that starts maybe late next year in Colorado, surfactant opportunities, et cetera. If you start stacking those up, what kind of incremental EBITDA should we be looking at 2, 3, 4 years out that kind of adds to what you've built in the water infrastructure and rest of your business on a current run rate basis? John Schmitz: Certainly, as we think about some of the other opportunities around the portfolio, I think at the end of the day, the core focus remains how do we build upon the core build-out of the infrastructure platform, how do we maximize value out of the return -- or the investments we are making to improve returns over time, something like the mineral extraction opportunity set that we added on to this quarter with iodine in addition to the previously announced lithium projects. All of that we view as margin enhancing and return enhancing to the existing investments we're consistently making. So how do we continue to focus on maximizing that return profile over time, whether it's adding the interruptibles and increasing that utilization over time. So it's very fair to say the earnings power capability of the asset base is much higher than it sits today. Some of that will take time. We're certainly expecting to get dollars flowing on the minerals side in 2027, but it will take time to scale it up over a period of time to multiple facilities in multiple regions and some of the other tangential opportunities. But as we sit here today, building upon the growth that we already are executing on, pulling effectively forward a full year of earnings into this year, we think it sets us up great. Obviously, there's components of the business that we'll need to see continued strength and outlook of the macro environment. But whether it's the services or the chemical side in addition to infrastructure, the asset base is capable of significantly more and the activity profiles that the market is setting the stage for, we're in a position to continue to execute on without meaningful capital investment, particularly on the services side. Operator: Our next question is from Bobby Brooks with Northland Capital Markets. Robert Brooks: I wanted to get an update on your ROFR acres within the Permian. Obviously, as those flip to active sites, it can represent very accretive deals. So I was just curious to hear have those in your year-to-date results -- do your year-to-date results benefit from any of those ROFR acres slipping to active sites that maybe you initially didn't plan for? And just more broadly, how should investors be thinking about the uplift from them? Michael Skarke: This is Michael Skarke. The ROFR acres are a big part of the way that we're constructing deals. We love the dedicated acres that aligns us well with our customer. We underwrite the geology. We feel great about the rock in the Northern Delaware and the ROFR acres really give us that option value that as the operator starts to expand and our system starts to expand, those are acres that we expect to pick up. In our year-to-date results, we have not seen a material conversion of the ROFR acres into dedicated acres. Although that's something that we still expect to see going forward and are working hard to secure as the operators' plans start to move that direction as our system gets built out. But when we look at what the system can do, and John addressed this a little bit with Jim's question, we size our expansions around an anchor tenant, but we upsized the system whether the throughput of the pipes by about 50% or doubled to get 50% underutilized capacity. It's that excess capacity, that commercialization is really where I think you'll see the big win over the next couple of years as we build the system out and fully commercialize it with interruptibles, but also with MVCs, smaller MVCs, dedicated acres just to lesser operators, smaller operators, not lesser, smaller operators. So that's really what we're excited about. John Schmitz: And I think importantly, Bobby, the position we've built and the system we have in place as our customers continue to grow, as we mentioned, whether that's through consolidation, whether that's through new exploration or new acreage additions, we're extremely well positioned to support them in that growth and establish the contract frameworks that allow us to effectively and efficiently convert that into tactical growth over time. Chris George: And I think the new acreage position is particularly important because we're seeing operators push the boundaries of how we have traditionally defined the Northern Delaware. They're stepping out further and further and getting really good results. And as they do that, our network is best positioned to support them in those expansions. So as you continue to see new exploratory wells become core and operators expand their positions beyond what we classically defined as the core Northern Delaware, I think that's going to be a really good fit for us. Really appreciate that color. Robert Brooks: And then there's been a lot of talk today of the growth of opportunity sets for infrastructure and the pipeline of that. Could you maybe just help frame that growth in some way? Is the pipeline maybe -- is it 20% larger than it was a year? Or is it 20% larger than what it was at year-end '25? Just trying to frame how that pipeline has grown. John Schmitz: So I'll start and let Chris clean me up. I had a comment in March on our Q4 about the pipeline. And really what I was talking about is we had a couple of really large opportunities out there, one of which we just announced on this earnings call. And -- but we were seeing more and more of the small commercialization opportunities. So the number of projects in our backlog in our pipeline continues to grow. And really, as we expand our market-leading large diameter network, you're accessing new acreage, and we are the most logical solution from a cost perspective to continue to expand with them. What we're seeing right now is we're seeing more interest in recycling today than we ever have before. And I think in part, it's because of the size and scale of our system, the flexibility of our system, operators have more comfort in the longevity and sustainability, the reliability of that recycling solution. And so it's kind of a self-fulfilling process. The bigger you get, the more customers you bring on, the more reliable you are and the more you're able to expand. I do think going forward, you're going to see us do more deals that require less capital than maybe you have in the past on some of these bigger chunkier deals. Chris George: Yes. Still very fair, though, to say there's still a couple of chunky opportunities out there, but there is a point at which the white space in the map gets filled in some regard. And so we wanted to be clear in our view that there is still some larger opportunity sets out there. As we look forward into 2027 and think about the capital profile, we do think there is another year of meaningful build opportunity in 2027 at probably a larger size than we might have otherwise anticipated. But importantly, as we've accelerated the earnings growth so far this year, we're doing so in a manner that's allowing us to continue to backfill that investment opportunity set into next year in addition to supporting the earnings growth meaningfully beyond where we came into the year. And so we do think that even if we were able to replicate another year of the growth capital in '27 like we're seeing in '26, that's still creating an opportunity to increase the free cash flow generative potential of the business that can really accelerate as we look forward another year into 2028. Michael Skarke: And Bobby, I know you understand this, but it's probably worth just reiterating like the project we just announced, and we announced it today. It's going to be operational in 12 months. We're probably going to need a couple of months to really make it efficient and start to optimize it. And so an announcement today is spend over 12 months and cash flow in month kind of 13 through 5, 6, 7, 10 years after that. Chris George: And importantly, what that means is you've got a view on continued growth looking into '28 on top of the run rate growth we're already executing on into '27. John Schmitz: Yes. Robert Brooks: Very helpful color. And then just last one for me is on that, the 128 million barrel minimum volume commitment project announced yesterday. Obviously, that was great to hear and nice to hear that was like something that was in the pipeline that you executed on. But just curious to hear a deeper discussion on how this deal might contrast to the past deals because it does seem like there's some key differences. Obviously, the scale, the 14 SWDs that they gave -- handed over to you. But are there other pieces that are important to be thinking about of how this might be different from past ones we've seen? John Schmitz: I think there's a couple of things, and we kind of hit on it, Bobby, but I'll reiterate, we're really excited about those 14 SWDs in New Mexico. We think that's a big deal that our system rendered those underutilized where the operators saw very little value in them. And when you tie them into our network, that allows us to provide increased firm takeaway and really make sure that our recycling first solution can weather the highs and lows of a cyclical business. So we get really excited about that piece. The other thing I thought was interesting, and it really speaks to the value of our [ Lorth ] pipeline network. This operator, we traditionally do things on a dedicated acreage basis, and we like that. This was a large MVC because they really wanted to reserve capacity on a specific piece of pipe that they wanted us to build. And it takes our system down into Texas, which is going to be a geographic expansion for us. But the fact that they were willing to sign up for an MVC, they had, they believe they need it, they're going to use it, and we're going to size it appropriately so that other operators can benefit from this expansion as well. Chris George: Yes. This certainly wasn't the first time we've been directly conveyed assets. We've now done this multiple times over the last year or 2 where we've had customers directly convey assets, whether that's disposal, recycling, storage or pipe. And so I think what you continue to see is the value of having interconnectivity to our network creates more value to the customer than stand-alone assets and the commercial ability to monetize those and utilize those effectively. So we think that's something that we've continued to execute on. And then furthermore, as Michael mentioned, our ability to continue to add MVCs, whether a real size like this one or some of the smaller ones we've tactically added on over the last couple of quarters. The bigger the system gets, the more surety folks want to access to the system. And so I think that ability to translate those from dedications into MVCs on a secondary and a tertiary basis, we'll continue to see opportunities around. John Schmitz: Bobby, this is John. The -- Michael made a very good point. I mean the network is very valuable to putting the 14 SWDs in place to get an ability to add capacity of disposal to the system. And then Michael said it gets us to the Texas line every time we move another contract into another area, it gives this system a very unique position because this system is dual line. It collects and distributes for a recycle first program. It's really the only one out there. But every time it has an extension, the thesis itself, the network value gets extended into a different area and gets an ability to hook up to more pipe and more assets. Quarter. Operator: Our next question is from Derrick Whitfield with Texas Capital. Derrick Whitfield Great update across all 3 segments. I wanted to start with your Chemicals segment for my first question. How would you characterize the demand you're seeing in the market today for surfactants? How broad-based is it? And what could it grow to be within your portfolio? Michael Skarke: Yes, go ahead. John Schmitz: I'll take. Michael Skarke: Yes. Derrick, this is Michael. So I appreciate the question. As we've mentioned in the past, we're seeing increased demand for surfactants, and it's really completions and workovers and a little bit of EORs. We're expecting this to continue to grow into 2027. But I think it's important to start with the market. We do less than 10% of the new well completions today are using surfactants. And of the ones using it, it's 95% out of the Permian. There's a lot of room for this market to grow. It's just going to take some time to get there. And what I mean by that is we've developed 26 new formulas for just one customer. And this is the kind of specialty chemistry that really required for surfactants to be worth it to add the value that they can add. This is also where our chemistry team really excels. I guess to answer the last part of your question, surfactants are still a fairly small percent of our chemicals revenue. I mean it's consistent with it being 10% of the market, but it's increasing quickly. I mean we've seen it grow 50% year-over-year, and we see that growth continuing into 2027. Chris George: Yes. The only thing I was going to add to it is Paul and his team has a great team, but it also has a very unique position in the marketplace with the lab position we have, the reactive plant we have in Midland, the relation to water and produced water as part of this. And Michael said, just for that one, we did all this formulas, and we can do that very quickly with a great team and great assets. But if you ask the team today, they're saying everybody is still working with formulas and applying and coming up with new thoughts around surfactants. So we think this year has done a lot of testing, a lot of developing a lot of what if Ford for our customers, and we get to participate in that. We think that's going to turn into a great opportunity for us, but the volumes that we think it will turn into are probably more '27 volumes. Derrick Whitfield And maybe just to clarify on part of your response with the surfactants and their applications towards EOR, is that in an unconventional sense because that does have tax implications associated with that. That's something that Diamondback spoke to during their call. And I think, again, that has pretty significant implications for industry as they start to latch on to that and potentially get on that path? John Schmitz: That is correct. That's what I was speaking to and a great company and a great customer, but they're not the only ones. There are a lot of people very focused on it. And -- but that is the place that they're focused on. Derrick Whitfield Terrific. And maybe just following up on the mineral extraction opportunity. Are you guys seeing greater inbounds from industry following your announcements for applications for mineral extraction outside of on outside of lithium? So when you say industry, I would say we are seeing certainly more inbound in general. The potential offtakers is a pretty diverse group. I mean we're seeing the offtake ranging from glass manufacturers to battery manufacturers. So I think the offtake is diverse, which gives us good confidence in being able to place all of the minerals. And I think what was most important to us and remains important is the fact that we did a lot of work around characterizing our asset base. And like thanks to Michael and the team, that asset base continues to grow. And the merging of our knowledge of pretreatment, getting large volumes of water treated and available and really the recycling component of our network really unlocked for us and I think for the industry, the ability to do this at scale. So yes, we and our partners are both getting inbounds. And I think the fact that we can create a domestic supply is also very important, like you're seeing defense and other folks that really care about the supply chain end-to-end also inbound. So I think we remain very, very excited about the opportunity. As we said earlier, I mean, it's pick and shovel work. I mean we've got to make sure the land is ready and that the war bonds are there. So I mean, we will -- and it's completely first of kind on all of these. So I think we will take some time to get the flywheel running, but then we'll have really a widget that we can go out and just -- it will start to accelerate. And so you'll see the financial impact over time. It will be in our forecast, and we'll talk about facilities and so on as they get up and running. Derrick Whitfield And then maybe just one clarification. Part of what I was thinking about was with the success that you guys have had with these mineral extraction opportunities for iodine and lithium specifically, have there been other critical minerals, whether it be magnesium or other components that are starting to create opportunities or inbounds right now for you guys? Yes. So we've looked at magnesium as one option. Frankly, I think it's pretty hard economics. So we haven't focused very much on that versus just doing it with seawater or other sources. We have -- one of our partners is looking at Strontium as an option. It's a very unique mineral and there's others. So again, that's part of our ongoing characterization of our asset base. And not all mineral concentrations are created equal across the network. And frankly, it's one of the great things about being a multi-basin or all-basin player that gives us that access. So I think as we were speaking before, I mean, this is just -- I think it's a phenomenal way to get every last dollar and drop of value out of our water. Chris George: And one thing I might add to it, Michael said it earlier, as you continue to expand the bounds of what the geology looks like, what the opportunity set looks like in a specific region, the quality of that water, the interaction of that water to the system changes. And so one of the things you can continue to do is just make the mineral content review part of your just core expansion opportunity set. As you move the water changes and as the water changes, what's the right opportunity set. So it's effectively just something that can layer on to the system over time and the growth opportunity set over time. Operator: Our next question is from Jimmy Larkin with Bank of America. James Larkin: I guess my first question is really starting on the guidance for Water Infrastructure next quarter. The 5% to 10% seems even if assuming a strong skim oil pricing environment, it seems that volumes are going to have to pick up pretty significantly next quarter. So I was wondering if you could just kind of talk through what you're seeing for volumes growth maybe into next quarter and the fourth quarter? And then how much of that is primarily related to kind of the start-up of your next recycling facility in the third quarter? John Schmitz: Yes. So the skim oil component of this is certainly part of the growth we saw in Q2 and is a strong potential continued tailwind for the outlook into Q3. to put some specific context around that. Obviously, you saw the uplift starting in March on the skim oil pricing. In the second quarter, you saw that hold through for the majority of the period. So if you think about the variability between something like a $65 spot pricing environment and a $95 spot pricing environment, that can reflect give or take, around $1 million a month of variability. So that is something that will be a component of the outlook in one form or fashion depending upon where the commodity sits at any point in time. But as we think about the volume side, we do expect to see recycling growth from a volumetric standpoint in the third quarter with new facilities coming online. We do have new disposals that have been added to the portfolio here as well, both organically and through acquisitions that will drive growth in the disposal side of our volume framework. So our expectation would be to see volumes grow generally in line with that 5% to 10% growth framework that we guided to for the top line in Q3, assuming generally a fairly steady commodity pricing environment to what we see today. Chris George: The only thing I'd add to that is it's not all new facilities coming online. There's a heavy portion of just commercialization and kind of seasoning facilities and getting them operational. So getting back to my comments earlier, as you think about this going forward, I think this platform will support continued growth without having to add more capital along the way. James Larkin: Great. And then I guess my second question, just going back to data centers is obviously a big theme still. And just we had a data center in West Texas that was announced -- that announced that it would use produced water in the future. And seemingly, there's more data centers in West Texas to come. I was just kind of -- can you remind us how you guys would be set up to benefit from this? And if you're seeing any kind of discussions pick up on that side? John Schmitz: I'd start off by saying just if you think about Select, our core competency is sourcing water, moving it, treating it and disposing of it and doing so in very large quantities in a cost-efficient manner. And so that really aligns us well with data centers and developers and EPC firms, and we're involved in multiple conversations in West Texas and frankly, outside of West Texas on just that. The water needs are going to vary depending on the project and where it is and how they're operating. But we've established Select as an expert in water and water logistics, and that puts us really as one of the premier service providers -- solution providers around water. So we're having the conversations. We're a part of them and certainly hopeful that we can be -- continue to grow as that segment of the market increases. Chris George: Yes. I think one thing to add to your question on reusing produced water. I mean, beneficial reuse is part of the overall kind of opportunity set around comprehensive produced water management. At the end of the day, it's going to be a core part of long-term solutions for the Permian Basin to manage the core application of produced water management in the oilfield. So what you do with that water on the backside of that data center is certainly a very potential and sizable part of that opportunity set to deploy those barrels. But there's also going to be short-term need for other application of source as well. And then I'd also add, there's also a picks and shovels aspect of the data center opportunity set that supports the build-out phase, the construction time lines of these projects over the next couple of years as well that our services business is very well positioned to support in addition to the long-term opportunity set around the water logistics and water management. Operator: Our next question is from Don Crist with Johnson Rice. Donald Crist: Continuing on the data center side, obviously, you have peak out there, and they have a very specific skill set. Are you seeing inbounds on the data center side, not necessarily from the water and beneficial use on water, but from the peak side as well and the growth there? John Schmitz: As I kind of alluded to a second ago, we do see opportunity on the services side of the business, and that's coming out of both the peak side of our business on the Power Solutions on a distributed basis as well as some of the other rentals and support solutions, storage solutions and logistics. So as an example, in the second quarter, we did have about $6 million of revenue come out of the services side of the business in support of those construction projects for data center projects. So that's obviously going to be a variable opportunity set, but it's something that we've got real tangible existing revenue from and Peak is a component of that, primarily on the Power Solutions basis. So it's been a good opportunity to see that. We're not necessarily looking to scale that into the large behind-the-meter solutions in support of those projects. But during the build-out phase, talking about the distributed needs of those solutions in support of these projects is something we've already seen success with, and I think we'll continue to see success with in the coming quarters as we think about how the water side of the business can further enhance that relationship over time. Donald Crist: Okay. And I wanted to ask about customer behavior because obviously, there's been some rigs added to the industry up to 50 or 60, but we haven't really seen too much on the completion side, which is obviously more impactful for you all. But as you kind of get schedules for the next 6 months to 9 months or 12 months, are you seeing, generally speaking, a pickup, whether it be from the start-up of the natural gas pipelines out of New Mexico or just from the lack of additions to completion activity so far? I mean, just any kind of color around that because in my opinion, it feels like we're underestimating the completion activity in '27 as of right now? John Schmitz: Yes. The answer is in 2 segments. They're both really good answers as it comes to Select and the opportunity for Select Don, and this is John. I would tell you that the intensity of the completion cycle of these wells and the lateral length continue to be a really good tailwind for us. I mean, we fit in that so well as these operators continue to do more with less and get better results. We really like that space, and we are surprised how much push there is from the operator to do that. On the industry itself as far as you're correct, we've added drilling horsepower now. We're drilling wells. There's going to be a ramp in the amount of frac fleets running how they complete those wells are going to be higher intensity. It's going to be a really good opportunity for pretty well all points of Select. If you look across chemicals, water service, our last mile logistics or what they're doing with those drilling rigs where they're going, you just look at the Haynesville, it's doubled in drilling rigs, and we have a very unique position in takeaway for the Haynesville. So I think we set up really well on both sides of it, Don. Donald Crist: Yes. And that was going to be my next question was going to be all the discussion has been around the Permian, but your positions in probably the Bakken are probably doing pretty well from a workover perspective and in the Haynesville and Marcellus as well. John Schmitz: Yes. Select is very unique in that sense. I mean what Michael and his team has put together in the upper Delaware and that dual value system, we think that's some of the best rock in the United States. It has the most challenge to produce water management and frac water management. But if you go to the Northeast, we probably have the #1 position in disposal. If you go to the Haynesville, that is a very unique piece of pipe that's coming out of the soda Parish in the Joaquin. Our concentration in the Bakken, we really do like. We got a lot of wellbores. So I think we're set up to bring value to our customers across the plays in a very unique way. Of course, we can't talk enough about that Delaware position because it's very, very unique, Don. Chris George: Just to put some specificity to what John said, I mean, again, he's exactly right. But we've executed -- we have infrastructure assets in every U.S. onshore basin, and we've executed contracts this year in most of those basins. Now they all compete with capital. The Permian is getting the bulk of it, but we're still getting deals done in other basins, and I think that will certainly continue, Don. Operator: Our next question is from Jeff Robertson with Water Tower Research. Jeffrey Robertson: Michael, you talked about the way you all have built the Northern Delaware system with embedded capacity available for future utilization. Can you share any color on how the take-up of the utilization on the system and how having the capacity with the new SWD wells that were conveyed could affect margins over the next couple of years? Michael Skarke: Sure. No, it's a great question, Jeff. So it's an infrastructure asset. So the more volumes you flow through, the higher your margins are going to go because of the high incremental margin for every incremental barrel. The key around the disposal is it increases the reliability and allows you to get closer to a maximum utilization around your recycling first network because when you get close to that recycling limit, if you go over it, you can always just send those barrels to disposal. So you can operate at a higher sustained utilization over a longer period of time. And that's one of the reasons we get excited about it. The other reason is there still are -- I mentioned we have more customers in recycling today than ever before. There still are some customers who are very fixated on firm capacity and making sure that you can provide firm capacity through good times and bad times, really, you have to count on some level of disposal. And so tying in more disposal to our system kind of helps us with that as well. Across the system, there's various constraints, but we've really done -- tried to do a very good job of oversizing the pipe and having 2 lines in every ditch so that we can send water north, south, east, west, all at the exact same time for maximum flexibility to really drive utilization as high as it can go. But I'd tell you that if we put no more capital in the system just through continued commercialization and with operators' drilling plans, you're going to see utilization continue to climb up. I mean what we've seen here on recycling, if you look at our earnings over the last few quarters or last few years, disposals increased some, but it's been fairly consistent, which you love the consistency of the produced water. Recycling has been a lot of the growth, and it's through increased utilization across that expansive network. Jeffrey Robertson: And you mentioned that the customer wanted a pipeline to extend, I think you said down to the Texas, New Mexico border. Is that a strategic decision on their part because they have other assets that could be added to the system in the future? Or was there something -- some other motivation behind that? Michael Skarke: You're exactly right. It was strategic on their part, and they were very specific as to where they wanted the pipeline to go and how much capacity they wanted to reserve on the pipeline. Now I would add that it's also strategic on our part. I mean we want to make sure that we're developing an asset that will solve that customer's need, but it's also something that we can use as part of a bigger opportunity to solve the basin's need. And so this was one of those really fun transactions that allows us to do both. Operator: Our next question is from John Daniel with Daniel Energy Partners. John Daniel: Michael, I believe in an earlier response to a question, you talked about 26 formulas designed for one customer. I'm curious, when you do that, do you own the formula? And once you have that formula, if it's working, can you take that and provide that to other operators? John Schmitz: Yes. So I'll answer your question generally, and the answer is it depends, depending on the operator you're working for. We will take specific formulas from operators and fine-tune them for them or manufacture those for them, and we're happy to do that. That puts volume through our manufacturing plant that gives us kind of that preferred relationship with the operator. However, there are a lot of opportunities where customers say, work on a formula for us, designing something for us, design something for the region, and we're doing the design work. And in most cases, we end up owning that formula. And it's not uncommon for an operator to come and say, "Hey, I want what XYZ has over there. Now it's not that simple. You can't just -- it's not portable. You want to go through the testing phase. And I thought John did a really good job of explaining kind of we're in that testing phase. We're excited about it, and we really think we're investing a lot of time and effort, and we think it's going to bear fruit or some in '26, but largely in '27. But it is good to see operators say, "Hey, what are you doing? What would work here and then we can bring those '26 formulas or others to that solution. John Daniel: Okay. Got it. And then going over to the SWDs that were conveyed to you guys. I know you also mentioned you've had that happen multiple times over the years. I'm just curious, when those are conveyed, is it the customer coming to you with the idea? Or are you proactively going out there and sourcing these opportunities? And how many inbound calls from other operators do you have with like similar conveyance ideas? John Schmitz: Yes. No, it's an interesting question, and I hadn't thought of it that way. It's actually both. We've had customers come to us and say, we want you to take these assets that we're not using them, you're going to use them more, it's going to backstop your performance for us, we want you to take them, which is a great feeling. It's really -- it's the strongest endorsement I can think of kind of what we've built. There are other scenarios where we've brought it up and said, "Hey, we've looked online and you're not putting many volumes through these wells. This would be really fit our system and help us better serve you. I think the key, whether it's their idea or our idea is at the end of the day, we get to the same point. which is the asset is more valuable to the customer under our control as part of our network. John Daniel: Okay. Got it. And so if you were to put someone's third-party volumes into that SWD that was conveyed to you that I'm assuming that's allowed and then there's ultimately a benefit to the person conveys to you or sorry for asking a dumb question. John Schmitz: No, it's not a dumb question at all. It is allowed, and it would be to our benefit if we do that. Operator: We have reached the end of the question-and-answer session. I would like to turn the floor back over to John Schmitz for closing comments. John Schmitz: Thanks to everybody for joining the call. We appreciate your continued support and interest in learning more about Select Water Solutions, and we look forward to speaking to you again next quarter. Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. Please disconnect your lines, and have a wonderful day. Before you buy stock in Select Water Solutions, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Select Water Solutions wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $411,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,335,252!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 11, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Select Water Solutions (WTTR) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Select Water Solutions, Inc. (WTTR) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company. Analysts' growing optimism on the earnings prospects of this company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- has this insight at its core. The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008. For Select Water Solutions, Inc., there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year. The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate: For the current quarter, the company is expected to earn $0.15 per share, which is a change of +400.0% from the year-ago reported number. The Zacks Consensus Estimate for Select Water Solutions, Inc. has increased 20.4% over the last 30 days, as one estimate has gone higher compared to no negative revisions. For the full year, the earnings estimate of $0.54 per share represents a change of +157.1% from the year-ago number. In terms of estimate revisions, the trend for the current year also appears quite encouraging for Select Water Solutions, Inc.. Over the past month, two estimates have moved higher compared to no negative revisions, helping the consensus estimate increase 18.13%. Thanks to promising estimate revisions, Select Water Solutions, Inc. currently carries a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision.You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500. Select Water Solutions, Inc. shares have added 5.1% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Select Water Solutions, Inc. (WTTR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Select Water Solutions, Inc.? Here are five stocks we like better. Select Water Solutions delivered a strong second quarter: Revenue rose 8% sequentially to $396 million, adjusted EBITDA increased 19% to $93 million—above guidance—and net income more than doubled to $23 million. Water Infrastructure led growth, with record $102 million revenue, 1.5 million barrels per day handled and a seven-year Northern Delaware Basin agreement backed by a 128 million-barrel minimum-volume commitment. The company expects segment revenue to grow another 5% to 10% in the third quarter. Select raised 2026 net capital spending guidance to $250 million–$290 million as infrastructure contracts, acquisitions and new opportunities expand its pipeline. Management also highlighted potential growth in data-center water services and mineral extraction, with mineral-related revenue expected to begin in 2027. 5 Small-Cap Stocks to Watch in 2026 as Investors Rotate Out of Big Tech Select Water Solutions (NYSE:WTTR) reported higher revenue, earnings and adjusted EBITDA for the second quarter of 2026, supported by record results in its Water Infrastructure and Chemical Technologies segments and stronger-than-expected performance in Water Services. Chief Executive Officer John Schmitz said consolidated revenue rose 8% from the first quarter, adjusted EBITDA increased 19%, and net income more than doubled sequentially. The company reported second-quarter revenue of $396 million, net income of $23 million and adjusted EBITDA of $93 million, exceeding its prior adjusted EBITDA guidance range of $77 million to $80 million. → No Hangover: Revisiting Microsoft One Week After Earnings “The second quarter of 2026 was a very strong quarter for Select,” Schmitz said, citing record revenue and gross profit in both Water Infrastructure and Chemical Technologies. Water Infrastructure generated record quarterly revenue of $102 million, up 5% sequentially and 26% from the second quarter of 2025. Gross profit before depreciation and amortization increased 9% from the first quarter and 27% year over year, while gross margin before D&A reached 58%. → MarketBeat Week in Review – 08/03 - 08/07 Chief Financial Officer Chris George said produced-water volumes handled increased to 1.5 million barrels per day. Higher produced-water volumes, improved skim-oil capture and higher pricing supported the segment’s results. The company expects Water Infrastructure revenue to grow another 5% to 10% in the third quarter, with gross margins before D&A between 56% and 58%. Management said the performance through the first half positions the segment to reach the high end of its 25% to 30% full-year growth target. → Why the Landlord of the AI Boom Could Outlast the Chipmakers During the quarter, Select added several minimum-volume commitments, acreage dedications and interruptible tie-in agreements. It also signed a seven-year agreement with a large public operator in the Northern Delaware Basin that includes a 128 million-barrel minimum-volume commitment. Under that agreement, the operator conveyed 14 underutilized saltwater disposal wells in Eddy and Lea counties, New Mexico, to Select. The company also acquired two other Delaware Basin disposal wells during the quarter, bringing the total number of new active disposal wells added in the region to 16. Select expects the project tied to the large minimum-volume commitment to cost approximately $25 million to $30 million and become operational within 12 months. Chief Commercial Officer Michael Skarke said the project will extend Select’s network toward Texas and was structured to meet the customer’s requested capacity while also supporting broader basin opportunities. Management said conveyed disposal assets can make the broader network more reliable and enable higher utilization of its “Recycle First” system by providing additional disposal capacity when recycling volumes fluctuate. Water Infrastructure revenue: $102 million Produced-water volumes handled: 1.5 million barrels per day Water Infrastructure gross margin before D&A: 58% Third-quarter Water Infrastructure revenue growth outlook: 5% to 10% Chemical Technologies reported revenue of $96 million, up 23% from the first quarter, while gross profit before D&A rose 35% sequentially to $19.4 million. The segment’s gross margin before D&A was 20%. Schmitz said increased completion intensity, demand for higher-specification products and growing interest in surfactant technology contributed to the segment’s record revenue. The company said it expanded market share through in-basin manufacturing, product development and field execution, while maintaining margin gains despite increased oil-based raw-material costs. For the third quarter, Select expects Chemical Technologies revenue of $85 million to $90 million based on customer schedules, with margins before D&A of 20% to 21%. Skarke said surfactants remain a relatively small part of the chemicals business but have grown 50% year over year. He said the company estimates that less than 10% of new well completions currently use surfactants and that about 95% of that usage is in the Permian Basin. Management expects the opportunity to grow into 2027 as customers continue testing formulations and applications. Water Services revenue rose approximately 4% sequentially, compared with management’s prior expectation for a modest decline. Gross margin before D&A improved to 23% from 21.8% in the first quarter, aided by slightly improved activity levels and continued strength in last-mile logistics and rental offerings. Select forecast generally steady Water Services revenue in the third quarter and margins before D&A of 20% to 22%. George said the segment could benefit from higher activity and pricing if commodity prices remain elevated. Select generated $87 million of operating cash flow in the second quarter, improving from the first quarter as working-capital management stabilized. It deployed $112 million toward capital expenditures and acquisitions, including $70 million of net capital expenditures and $42 million of strategic Water Infrastructure bolt-on acquisitions and lease buyouts. The company also closed its previously announced acquisition of Black River Ranch, a surface position in Eddy County, New Mexico. Management said the acquisition adds future infrastructure development opportunities, surface and mineral cash flows, and cost synergies with Select’s existing network. Select increased its 2026 net capital expenditure outlook to $250 million to $290 million, citing infrastructure contract awards and the expanding growth opportunity set. Maintenance capital needs remain around $60 million, according to George. George said the company sees another year of double-digit Water Infrastructure growth in 2027 based on its current project backlog and recent contract wins. He added that additional project awards and bolt-on acquisitions could further expand that outlook. Management said new infrastructure projects require time to translate into cash flow. The newly announced minimum-volume commitment project, for example, is expected to involve spending over the next 12 months before becoming operational and contributing earnings afterward. Select forecast consolidated adjusted EBITDA of $90 million to $94 million in the third quarter. The company expects Water Infrastructure growth to offset a more measured near-term outlook for Water Services and Chemical Technologies. It also said modest seasonal effects could affect parts of the business in the fourth quarter. Management discussed opportunities to use its water sourcing, treatment, logistics and disposal capabilities to support data-center development. George said Select recorded approximately $6 million of Water Services revenue during the second quarter from supporting data-center construction projects, including distributed power solutions from its Peak business as well as rental, storage and logistics offerings. The company said it is involved in discussions regarding water needs for data centers in West Texas and elsewhere, including potential beneficial reuse of produced water. Management noted that the opportunity includes both construction-phase services and longer-term water-management needs. Select also continues to pursue mineral-extraction opportunities associated with its water infrastructure. The company announced an iodine-extraction agreement during the quarter and previously discussed lithium projects. Chief Strategy and Technology Officer Mike Lyons said the company and its partners are receiving interest from potential off-takers ranging from glass manufacturers to battery manufacturers. Lyons said Select has evaluated other minerals, including magnesium and strontium, though he noted magnesium economics are challenging. Management expects mineral-related revenue to begin flowing in 2027 but said scaling the opportunity across facilities and regions will take time. “We are very pleased with the strong year-over-year trajectory across all parts of the business so far in 2026,” George said. Select Water Solutions, Inc, headquartered in Houston, Texas, is a water management services provider primarily serving the oil and gas industry. Formerly operating under the name Select Energy Services, the company rebranded to reflect its core focus on water treatment, recycling and disposal. Since its inception in 2016, Select Water Solutions has expanded to key U.S. basins—including the Permian, Eagle Ford, Marcellus and DJ Basin—and maintains strategic operations in select international regions. The company's offerings span the full water lifecycle, from produced water gathering and transportation to advanced treatment and beneficial reuse. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Select Water Solutions Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Select Water Solutions, Inc. WTTR used its second-quarter 2026 earnings call to emphasize a longer growth runway for Water Infrastructure, supported by new contracts, rising utilization and a larger project backlog. The quarter also delivered a broad operating beat. Reported earnings of $0.17 per share beat the Zacks Consensus Estimate of $0.11, while revenues of $395.8 million exceeded the $365.9 million estimate. Select Water Solutions, Inc. price-consensus-eps-surprise-chart | Select Water Solutions, Inc. Quote CEO John Schmitz said that Water Infrastructure remains the central growth engine after segment revenues reached a record $101.6 million and gross margin before D&A rose to 58.3%. The key addition was a seven-year agreement backed by a 128-million-barrel minimum volume commitment. The customer also conveyed 14 saltwater disposal wells, while Select will build 19 miles of pipeline for an estimated $25 million to $30 million. Chief commercial officer Michael Skarke said that the project expands the network toward the Texas-New Mexico border and creates capacity that can serve both the anchor customer and additional operators. CFO Chris George said that 2026 net capital expenditures are now expected at $250 million to $290 million, above the prior guidance ceiling of $250 million. George tied the increase to additional infrastructure awards and an opportunity set that has expanded with the Northern Delaware system. Select also added two separately acquired disposal wells, bringing second-quarter additions to 16. The CFO said that the current build phase will constrain free cash flow this year, but the contracted projects are designed to support improved free cash flow potential in 2027 and beyond. George projected third-quarter adjusted EBITDA of $90-$94 million, following $92.7 million in the second quarter and exceeding the prior second-quarter outlook of $77-$80 million. George said that Water Infrastructure revenues should grow 5-10% sequentially, with gross margins before D&A of 56-58%. He expects full-year segment growth near the high end of the 25-30% range. The CFO forecast Chemical Technologies revenues of $85 million to $90 million with margins of 20% to 21%, while Water Services revenues are expected to remain generally steady. A Water Tower Research analyst asked how added disposal capacity could affect utilization and margins. Chief commercial officer Skarke said that higher throughput carries strong incremental margins and disposal capacity lets the recycling network operate closer to its limits. Skarke added that utilization can continue rising through commercialization and customer drilling plans even without further capital spending. Recycling, rather than disposal, has driven much of the network's recent volume growth. A Northland Capital Markets analyst also asked about right-of-first-refusal acreage. Skarke said that year-to-date conversions into dedicated acreage were not material, leaving that opportunity as future option value rather than a current earnings driver. A Raymond James analyst asked whether infrastructure growth can remain strong next year. George said that the current base case begins with another year of double-digit growth in 2027, with additional project wins or bolt-on acquisitions offering upside to that profile. In chemicals, Skarke stated that surfactants remain a small share of revenue but grew 50% year over year. Fewer than 10% of new-well completions use surfactants today, and Skarke expects more meaningful volumes in 2027. CEO John Schmitz said that mineral extraction should begin contributing dollars in 2027. CFO Chris George added that second-quarter Water Services revenues included about $6 million tied to data-center construction support. Management's tone remained confident but disciplined. Schmitz emphasized long-term contracts, network utilization and projects that strengthen Select's integrated recycling and disposal position. George also flagged potential fourth-quarter seasonality, keeping the near-term outlook measured even as the company positions its infrastructure backlog for growth into 2027 and 2028. WTTR currently carries a Zacks Rank #3 (Hold). Its Growth Score of A and VGM Score of A are complemented by a Value Score of B and a Momentum Score of B, indicating favorable characteristics across the three investing styles. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The Style Score is most powerful when paired with a Zacks Rank #1 or #2. A Rank #3 provides a more neutral signal, and the rank can change as analyst earnings estimates are revised following the newly reported results. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Select Water Solutions, Inc. (WTTR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Select Water Solutions Inc (NYSE:WTTR) delivered record revenue and gross profit in both its water infrastructure and chemical technology segments during Q2 2026, with consolidated revenue up 8% and adjusted EBITDA up 19% sequentially. The company secured a major seven-year agreement with a large public operator in the Northern Delaware Basin, backed by a substantial 128 million barrel minimum volume commitment (MVC), which also included the conveyance of 14 strategic saltwater disposal wells (SWDs). Water infrastructure segment revenue grew 26% year-over-year to $102 million, driven by increased produced water volumes and improved skim oil recovery, with gross margins before D&A reaching a strong 58%. Chemical technology segment posted a stellar quarter with revenue of $96 million, up 23% sequentially, driven by market share gains and increased demand for higher-spec, higher-margin products like surfactants and friction reducers. The company is well-positioned for continued growth, expecting to hit the upper end of its 25% to 30% full-year growth guidance for water infrastructure and projecting double-digit growth into 2027, supported by a robust project pipeline and new mineral extraction agreements (e.g., iodine). Select Water Solutions Inc (NYSE:WTTR) faces potential margin pressure in its chemical technology segment due to increased oil-based raw material input costs, despite achieving margin gains in Q2. The company's water services segment is expected to see generally steady revenue levels in Q3, with margins forecast to decline slightly to the 20% to 22% range from 23% in Q2, indicating limited near-term growth. Chemical technology revenue is forecast to retrench to $85 million to $90 million in Q3 from $96 million in Q2, reflecting a modest pullback based on current customer schedules. The ongoing build phase of the Northern Delaware infrastructure network will limit free cash flow potential in 2026, with net capital expenditures increased to $250 million to $290 million, potentially constraining near-term shareholder returns. The company anticipates potential modest seasonal impacts in the fourth quarter across parts of the business, which could temper the strong growth momentum seen in the first half of the year. Warning! GuruFocus has detected 11 Warning Signs with WTTR. Is WTTR fairly valued? Test your thesis with our free DCF calculator. Q: How should we think about the rate of growth for the water infrastructure segment going into next year, given the current run rate and recent project wins?A: Chris George (EVP & CFO): We are confident in executing another year of double-digit growth into 2027 based on our current run rate and the projects we have in hand. We have a robust opportunity set to add to this profile through additional project wins and bolt-on acquisitions over the next couple of quarters. John Schmitz (CEO) added that the recent deal where an operator conveyed 14 SWDs to Select is a powerful validation of the "recycle first" network and its importance to the industry. Q: Can you provide more detail on the new 128 million barrel minimum volume commitment (MVC) contract and how it contrasts with past deals?A: Michael Starkey (EVP & Chief Commercial Officer): This deal is significant for several reasons. The conveyance of 14 SWDs in New Mexico is a big deal because our system rendered them underutilized for the operator, and tying them into our network increases our disposal capacity and reliability. It also expands our pipeline network geographically into Texas, as the operator wanted to reserve capacity on a specific new pipe. Chris George added that this is not the first time customers have conveyed assets, and it demonstrates that interconnectivity to our network creates more value for the customer than stand-alone assets. Q: What is the current status of your "row for acres" (right-of-way for acres) in the Permian, and how should investors think about the potential uplift from them?A: Michael Starkey (EVP & Chief Commercial Officer): We have not seen a material conversion of row-for-acres into dedicated acres in our year-to-date results, but we expect this to happen as operators' plans move forward and our system builds out. We size our expansions around an anchored tenant but upsize the system by about 50% to have underutilized capacity. This excess capacity is where we expect to see big wins over the next couple of years through commercialization, including interruptibles and smaller MVCs with other operators. Q: How would you characterize the current demand for surfactants, and what is the growth potential for this product within your portfolio?A: Michael Starkey (EVP & Chief Commercial Officer): We are seeing increased demand for surfactants driven by completions, workovers, and EOR. Less than 10% of new well completions currently use surfactants, and 95% of that is in the Permian, so there is significant room for market growth. We have developed 26 new formulas for a single customer, which highlights the specialty nature of this chemistry. Surfactants are still a small percentage of our chemical revenue, but it has grown 50% year-over-year, and we expect that growth to continue into 2027. John Schmitz (CEO) added that 2026 is a year of testing and development, with volumes expected to materialize more in 2027. Q: Are you seeing greater inbound interest for mineral extraction opportunities beyond iodine and lithium, and what other minerals are being considered?A: Mike Lyons (EVP & Chief Strategy and Technology Officer): We are seeing more inbounds from a diverse group of potential off-takers, ranging from glass manufacturers to battery manufacturers. We have looked at magnesium, but the economics are challenging. One of our partners is exploring strontium. The key is that we have done extensive work characterizing our asset base, and our ability to treat large volumes of water at scale has unlocked the ability to do mineral extraction. We remain very excited about the opportunity, though it will take time to scale up. Q: What is driving the 5% to 10% revenue growth guidance for water infrastructure in Q3, and how much is related to new facility startups versus volume growth?A: Chris George (EVP & CFO): The skim oil component was a strong contributor to Q2 growth and remains a potential tailwind. The variability between a $65 and $95 spot pricing environment can reflect roughly $1 million per month of variability. On the volume side, we expect recycling growth from new facilities coming online and new disposals added to the portfolio. We expect volumes to grow generally in line with the 5% to 10% top-line growth framework. Michael Starkey added that a heavy portion of the growth is from commercialization and "seasoning" existing facilities, which supports continued growth without requiring additional capital. Q: How is Select positioned to benefit from the growth of data centers in West Texas, particularly regarding the use of produced water?A: Michael Starkey (EVP & Chief Commercial Officer): Our core competency is sourcing, moving, treating, and disposing of large quantities of water cost-efficiently, which aligns well with data center needs. We are involved in multiple conversations in West Texas and beyond. Chris George added that beneficial reuse is a core part of long-term produced water management solutions, and there is also a "picks and shovels" aspect where our services business can support the construction phase of these projects. In Q2, we generated about $6 million in revenue from services supporting data center construction projects. Q: Can you share color on how the increased utilization of the Northern Delaware system and the newly conveyed SWDs could affect margins over the next couple of years?A: Michael Starkey (EVP & Chief Commercial Officer): As an infrastructure asset, the more volumes flowed through the system, the higher the margins become due to high incremental margins per barrel. The added disposal capacity increases reliability and allows us to operate at a higher sustained utilization of our recycling network. Even without additional capital, continued commercialization and operators' drilling plans will drive utilization higher. Recycling has been the primary growth driver, achieved through increased utilization across the expansive network. Q: When you design 26 formulas for one customer, do you own those formulas, and can you provide them to other operators?A: Michael Starkey (EVP & Chief Commercial Officer): It depends on the operator. Sometimes we take specific formulas from operators and fine-tune or manufacture them, which puts volume through our plant. However, in many cases, we do the design work and end up owning the formula. It's not uncommon for operators to ask for what another operator has, but the formulas are not directly portable and require a testing phase. We are investing significant time and effort, and we expect this to bear fruit in late 2026 but largely in 2027. Q: Regarding the SWDs conveyed to you, is it typically For the complete transcript of the earnings call, please refer to the full earnings call transcript.

For the quarter ended June 2026, Select Water Solutions, Inc. (WTTR) reported revenue of $395.81 million, up 8.7% over the same period last year. EPS came in at $0.17, compared to $0.10 in the year-ago quarter. The reported revenue represents a surprise of +8.17% over the Zacks Consensus Estimate of $365.9 million. With the consensus EPS estimate being $0.11, the EPS surprise was +54.55%. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Select Water Solutions, Inc. performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Revenue- Chemical Technologies: $96.04 million compared to the $83.91 million average estimate based on three analysts. The reported number represents a change of +41.9% year over year. Revenue- Water Services: $198.15 million versus the three-analyst average estimate of $182.96 million. The reported number represents a year-over-year change of -8.1%. Revenue- Water Infrastructure: $101.61 million versus the three-analyst average estimate of $96.38 million. The reported number represents a year-over-year change of +25.7%. Gross Profit before D&A- Water Services: $45.5 million versus $38.72 million estimated by two analysts on average. Gross Profit before D&A- Chemical Technologies: $19.37 million versus the two-analyst average estimate of $17.67 million. Gross Profit before D&A- Water infrastructure: $59.2 million versus the two-analyst average estimate of $54.69 million. View all Key Company Metrics for Select Water Solutions, Inc. here>>> Shares of Select Water Solutions, Inc. have returned +1.6% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Select Water Solutions, Inc. (WTTR) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Select Water Solutions, Inc. (WTTR) came out with quarterly earnings of $0.17 per share, beating the Zacks Consensus Estimate of $0.11 per share. This compares to earnings of $0.1 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +54.55%. A quarter ago, it was expected that this company would post earnings of $0.01 per share when it actually produced earnings of $0.08, delivering a surprise of +700%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Select Water Solutions, Inc., which belongs to the Zacks Waste Removal Services industry, posted revenues of $395.81 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 8.17%. This compares to year-ago revenues of $364.21 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Select Water Solutions, Inc. shares have added about 74.7% since the beginning of the year versus the S&P 500's gain of 11%. While Select Water Solutions, Inc. has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Select Water Solutions, Inc. was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.13 on $371.05 million in revenues for the coming quarter and $0.46 on $1.47 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Waste Removal Services is currently in the top 42% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Concrete Pumping (BBCP), another stock in the same industry, has yet to report results for the quarter ended July 2026. This company is expected to post quarterly earnings of $0.08 per share in its upcoming report, which represents a year-over-year change of +14.3%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Concrete Pumping's revenues are expected to be $108.9 million, up 5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Select Water Solutions, Inc. (WTTR) : Free Stock Analysis Report CONCRETE PUMPING HOLDINGS, INC. (BBCP) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Generated second quarter 2026 consolidated revenue of $396 million, an increase of $30 million or 8% sequentially, as compared to the first quarter of 2026 Increased net income by $13 million and improved Adjusted EBITDA by $15 million sequentially during the second quarter of 2026 relative to the first quarter of 2026 Generated record Water Infrastructure revenue of $102 million, an increase of $5 million or 5% as compared to the first quarter of 2026, and an increase of $21 million or 26% as compared to the second quarter of 2025 Generated record Chemical Technologies revenue of $96 million, an increase of $18 million or 23% sequentially, as compared to the first quarter of 2026 Executed Definitive Agreement with a large public operator for the conveyance of 14 saltwater disposal wells ("SWDs") as well as the development of a new pipeline project supported by a 128-million-barrel minimum volume commitment in the Northern Delaware Basin GAINESVILLE, Texas, Aug. 4, 2026 /PRNewswire/ -- Select Water Solutions, Inc. (NYSE: WTTR) ("Select," the "Company," "we" or "us"), a leading provider of sustainable water and chemical solutions, today announced its financial and operating results for the quarter ended June 30, 2026. John Schmitz, Chairman of the Board, President and CEO, stated, "The second quarter was a very strong quarter for Select across all three operating segments, with both our Water Infrastructure and Chemical Technologies segments producing record revenue and gross profit in the quarter. During the second quarter of 2026, we delivered strong consolidated revenue and gross profit growth, resulting in $23 million of net income and $93 million of Adjusted EBITDA, respectively. "We continue to increase our produced water volumes handled in the Water Infrastructure segment, with approximately 1.5 million barrels of produced water recycled or disposed per day in the second quarter, while also seeing the benefit of increased skim oil volumes and pricing, resulting in record quarterly revenue of $102 million and gross margins before D&A of 58% for the segment in the second quarter. We expect to see further growth in the third quarter and are well on track to meet the upper end of our full year guidance for the segment, setting the stage for solid year-over-year growth into 2027. Further supporting this growth profile is the expansion of our multi-basin relationship and operations with a key customer through the execution of a strategic minimum volume commitment contract award, comprised of a 128-million-barrel commitment over a seven-year term. Furthermore, the agreement includes the direct conveyance of a portfolio of underutilized, but strategic SWDs across Lea and Eddy Counties, New Mexico. We continue to find ways to collaborate with our customers to maximize the value of existing assets and to optimize produced water management as part of their long-term development planning. We view this contract as a strong validation of the strategic value proposition of Select's broad and expanding commercial network of integrated recycling and disposal solutions. "As our system continues to grow throughout the Northern Delaware Basin, Select's backlog of potential opportunities has continued to evolve as well, and we are acutely focused on prudent growth that prioritizes long-term contracts, strong cash flow streams, and increased utilization across our networks. In support of our latest infrastructure contract awards and opportunities, we now expect net capital expenditures of $250 – $290 million in 2026. "Elsewhere, our Chemical Technologies segment saw significant sequential improvement, coming in well above our expectations, with a 23% increase in revenue and 30% increase in gross profit before D&A as compared to the first quarter of 2026. The $96 million of Chemical Technologies revenue in the second quarter was a segment record, and we continue to identify ways to deliver strong margins, despite increases to oil-based raw material input costs, with margins of 20% in the quarter. Our in-basin manufacturing, rapid new product development pace, and steady field execution have driven market share gains while increased completions intensity and complexity, and growing interest in surfactant technology, have supported increased demand for our higher margin product offerings. "Our Water Services segment also outperformed our expectations during the second quarter, with revenue growth of 4% and gross profit before D&A growth of 9% as compared to the first quarter of 2026. We have been pleased with the year-to-date performance of our last-mile water logistics and delivery business, and current macro trends remain supportive of sustained performance over the second half of the year. "In summary, I am pleased with the ongoing strategic execution in our Water Infrastructure business, and our ability to grow and take market share in our Water Services and Chemical Technologies segments. Altogether we expect another strong quarter ahead, and on a consolidated basis, we anticipate Adjusted EBITDA in the third quarter to be an estimated $90 – $94 million. With the support of a healthy balance sheet, we are well positioned to continue to invest in the attractive growth opportunities in front of us in order to deliver long-term value to our customers, employees, and stakeholders," concluded Schmitz. Second Quarter 2026 Consolidated Financial Information Revenue for the second quarter of 2026 was $395.8 million as compared to $366.0 million in the first quarter of 2026 and $364.2 million in the second quarter of 2025. Net income for the second quarter of 2026 was $22.6 million as compared to net income of $9.4 million in the first quarter of 2026 and net income of $11.7 million in the second quarter of 2025. For the second quarter of 2026, gross profit was $76.8 million, as compared to $65.3 million in the first quarter of 2026 and $57.8 million in the second quarter of 2025. Total gross margin was 19.4% in the second quarter of 2026 as compared to 17.8% in the first quarter of 2026 and 15.9% in the second quarter of 2025. Gross profit before D&A was $124.1 million for the second quarter of 2026 as compared to $111.0 million for the first quarter of 2026 and $98.8 million for the second quarter of 2025. Gross margin before D&A for the second quarter of 2026 was 31.3% as compared to 30.3% for the first quarter of 2026 and 27.1% for the second quarter of 2025. SG&A during the second quarter of 2026 was $41.2 million as compared to $40.6 million during the first quarter of 2026 and $38.9 million during the second quarter of 2025. SG&A during the second and first quarters of 2026 was impacted by transaction costs of $0.6 million and $0.3 million, respectively, while SG&A during the second quarter of 2025 was impacted by transaction costs of $1.7 million. Adjusted EBITDA was $92.7 million in the second quarter of 2026 as compared to $77.6 million in the first quarter of 2026 and $72.6 million in the second quarter of 2025. Adjusted EBITDA during the second quarter of 2026 was adjusted for $0.6 million of non-recurring transaction costs, $0.6 million of non-cash losses in equity investments, $0.2 million of impairments and abandonments, and $0.6 million in other adjustments. Non-cash compensation expense accounted for an additional $8.4 million adjustment during the second quarter of 2026. Please refer to the end of this release for reconciliations of gross profit before D&A (non-GAAP measure) to gross profit and of Adjusted EBITDA (non-GAAP measure) to net income. Business Segment Information The Water Infrastructure segment generated revenues of $101.6 million in the second quarter of 2026 as compared to $96.7 million in the first quarter of 2026 and $80.9 million in the second quarter of 2025. Gross margin before D&A for Water Infrastructure was 58.3% in the second quarter of 2026 as compared to 56.2% in the first quarter of 2026 and 55.2% in the second quarter of 2025. Water Infrastructure revenues increased 5.0% sequentially relative to the first quarter of 2026, driven by increases in total produced water volumes handled as well as the benefit of increased skim oil volumes and pricing. Looking ahead, the Company anticipates Water Infrastructure revenues to increase 5% – 10% as compared to the second quarter of 2026 with margins in the 56% – 58% range in the third quarter of 2026. The Water Services segment generated revenues of $198.2 million in the second quarter of 2026 as compared to $191.2 million in the first quarter of 2026 and $215.7 million in the second quarter of 2025. Gross margin before D&A for Water Services was 23.0% in the second quarter of 2026 as compared to 21.8% in the first quarter of 2026 and 19.6% in the second quarter of 2025. The Water Services segment revenues increased 3.6% sequentially, partially driven by modestly improved customer activity levels. For the third quarter of 2026, the Company expects steady revenues relative to the second quarter of 2026 with gross margins before D&A in the 21% – 22% range during the third quarter of 2026. The Chemical Technologies segment generated revenues of $96.0 million in the second quarter of 2026 as compared to $78.0 million in the first quarter of 2026 and $67.7 million in the second quarter of 2025. Gross margin before D&A for Chemical Technologies was 20.2% in the second quarter of 2026 as compared to 19.1% in the first quarter of 2026 and 17.5% in the second quarter of 2025. For the third quarter of 2026, the Company anticipates revenues of $85 – $90 million and gross margins before D&A of 20% – 21% for the segment. Cash Flow and Capital Expenditures Cash flow provided by operating activities for the second quarter of 2026 was $86.7 million as compared to $10.2 million in the first quarter of 2026 and $82.6 million in the second quarter of 2025. Free cash flow in the second quarter of 2026 and the first quarter of 2026 was $17.0 million and ($67.1) million, respectively and $10.8 million in the second quarter of 2025. Please refer to the end of this release for reconciliations of free cash flow (non-GAAP measure) to cash flow provided by operating activities. Net capital expenditures for the second quarter of 2026 were $69.7 million, comprised of $71.0 million of capital expenditures partially offset by $1.3 million of cash proceeds from asset sales. Cash flows from investing activities also included $42.0 million of acquisition-related outflows for the Black River Ranch acquisition, multiple disposal acquisitions in the Northern Delaware Basin and the buyout of multiple strategic operating facility leases across our operations in Texas. Cash flows provided by financing activities during the second quarter of 2026 were $2.9 million, primarily reflecting $13.0 million of net proceeds from an agricultural loan related to the Black River Ranch acquisition, partially offset by the payment of $9.6 million of quarterly dividends and distributions. Balance Sheet and Capital Structure Total cash and cash equivalents were $33.4 million as of June 30, 2026, as compared to $56.0 million and $18.1 million as of March 31, 2026, and December 31, 2025, respectively. As of June 30, 2026, the Company had $250.0 million of borrowings outstanding under the term loan component of its sustainability-linked credit facility, $12.9 million under the agricultural loan related to the Black River Ranch acquisition and no amounts drawn on the revolving credit facility, compared to $250.0 million of outstanding borrowings under the term loan and no amounts drawn on the revolving credit facility as of March 31, 2026 and $250.0 million of outstanding borrowings under the term loan and $70.0 million drawn on the revolving credit facility as of December 31, 2025, respectively. As of June 30, 2026, the borrowing base under the Company's sustainability-linked credit facility was $264.0 million, compared to $271.3 million and $235.1 million as of March 31, 2026, and December 31, 2025, respectively. Available borrowing capacity under the sustainability-linked credit facility was approximately $244.4 million as of June 30, 2026, after giving effect to outstanding borrowings and letters of credit totaling $19.6 million. As of March 31, 2026, available borrowing capacity under the credit facility was approximately $251.7 million, after accounting for outstanding borrowings and letters of credit totaling $19.6 million. Total liquidity was $277.8 million as of June 30, 2026, as compared to $307.7 million as of March 31, 2026, and $163.6 million as of December 31, 2025. The Company had 123,146,866 weighted average shares of Class A common stock and 12,733,751 weighted average shares of Class B common stock outstanding during the second quarter of 2026. The Company had 127,073,462 Class A shares and 11,158,101 Class B shares issued and outstanding as of June 30, 2026. Water Infrastructure Commercial Development and Acquisition Updates In the second quarter of 2026, Select signed a seven-year agreement with a large public operator (the "Operator") for produced water transportation across Select's Northern Delaware Basin infrastructure footprint. Under the agreement, the Operator has conveyed 14 saltwater disposal well facilities and related assets to Select in Lea and Eddy Counties, New Mexico. Additionally, Select has agreed to construct 19 miles of large-diameter pipeline to tie into Select's existing Northern Delaware Basin network to transport, recycle and/or dispose of the Operator's produced water in the region. The agreement is supported by a sizable 128-million-barrel minimum volume commitment ("MVC") over the seven-year contract period. The full project is expected to cost approximately $25 – $30 million and be operational within the next twelve months. During the second quarter of 2026, Select also completed two additional disposal facility acquisitions in the Northern Delaware Basin to support ongoing infrastructure projects and future development opportunities. In total, during the second quarter of 2026, Select added sixteen SWDs through both direct asset conveyance and acquisition to help support our growing infrastructure development activities in the Permian Basin. In addition to the above outlined projects and acquisitions, Select signed multiple additional commercialization contracts during the second quarter of 2026 requiring minimal incremental capital expenditures, including several MVC agreements, acreage dedications and interruptible tie-in agreements across the Permian, Bakken, MidCon and Northeast regions as well as a new mineral extraction agreement with a key strategic partner for the development of iodine extraction across the portfolio. Second Quarter Earnings Conference Call In conjunction with today's release, Select has scheduled a conference call on Wednesday, August 5, 2026, at 11:00 a.m. Eastern time / 10:00 a.m. Central time. Please dial 201-389-0872 and ask for the Select Water Solutions call at least 10 minutes prior to the start time of the call, or listen to the call live over the Internet by logging on to the website at the address https://investors.selectwater.com/events-presentations/current. A telephonic replay of the conference call will be available through August 19, 2026, and may be accessed by calling 201-612-7415 using passcode 13757760#. A webcast archive will also be available at the link above shortly after the call and will be accessible for approximately 90 days. About Select Water Solutions, Inc. Select is a leading provider of sustainable water and chemical solutions to the energy industry. These solutions are supported by the Company's critical water infrastructure assets, chemical manufacturing and water treatment and recycling capabilities. As a leader in sustainable water and chemical solutions, Select places the utmost importance on safe, environmentally responsible management of water throughout the lifecycle of a well. Additionally, Select believes that responsibly managing water resources throughout its operations to help conserve and protect the environment is paramount to the Company's continued success. For more information, please visit Select's website, https://www.selectwater.com. Cautionary Statement Regarding Forward-Looking Statements All statements in this communication other than statements of historical facts are forward-looking statements which contain our current expectations about our future results. We have attempted to identify any forward-looking statements by using words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast" "intend," "may," "plan," "potential," "preliminary," "project," "see," "should," "will," and other similar expressions. Examples of forward-looking statements include, but are not limited to, the expectations of plans, business strategies, objectives and growth, projected financial results and future financial and operational performance, expected capital expenditures, our share repurchase program and future dividends. Although we believe that the expectations reflected, and the assumptions or bases underlying our forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Such statements are not guarantees of future performance or events and are subject to known and unknown risks and uncertainties that could cause our actual results, events or financial positions to differ materially from those included within or implied by such forward-looking statements. These risks and uncertainties include the risks that the benefits contemplated from our recent acquisitions may not be realized, the ability of Select to successfully integrate the acquired businesses' operations, including employees, and realize anticipated synergies and cost savings and the potential impact of the consummation of the acquisitions on relationships, including with employees, suppliers, customers, competitors and creditors. Factors that could materially impact such forward-looking statements include, but are not limited to: global economic distress, including that resulting from the sustained Russia-Ukraine war and related economic sanctions, instability and continued hostilities in the Middle East and elsewhere, including military conflict involving Iran, instability in Venezuela, economic uncertainty as a result of changing trade policies, disruptions in global oil and gas markets and inflation and elevated interest rates, each of which may decrease demand for oil and natural gas or contribute to volatility in the prices for oil and natural gas, which may decrease demand for our services; the ability to source certain raw materials and other critical components or manufactured products globally on a timely basis from economically advantaged sources, including any delays and/or supply chain disruptions; actions taken by the members of the Organization of the Petroleum Exporting Countries ("OPEC") and Russia (together with OPEC and other allied producing countries, "OPEC+") with respect to oil production levels and announcements of potential changes in such levels, including the ability of the OPEC+ countries to agree on and comply with announced supply limitations, which may be exacerbated by military conflict in the Middle East involving Iran and the resumption of sales of previously sanctioned oil from Venezuela and Russia; the impact of central bank policy actions, such as sustained, elevated interest rates in response to, among other things, high rates of inflation, and disruptions in the bank and capital markets; the degree to which consolidation among our customers may affect spending on United States ("U.S.") drilling and completions activity, including the recent consolidation in the Permian Basin; impacts related to changing U.S. and foreign trade policies, including increased trade restrictions or tariffs; the impact of changes in diplomatic and trade relations, and the results of countermeasures and any tariff mitigation initiatives; changes in safety, health, environmental and other governmental policy and regulation; the enactment or promulgation of new laws or regulations or changes or modifications in existing laws, regulations, rules or governmental policies with respect to taxation; the level of capital spending and access to capital markets by oil and gas companies in response to changes in commodity price or reduced demand; the potential deterioration of our customers' financial condition, including defaults resulting from actual or potential insolvencies; trends and volatility in oil and gas prices, and our ability to manage through such volatility; the impact of current and future laws, rulings, governmental regulations and policies, including those related to accessing water, disposing of wastewater, transferring produced water, interstate freshwater and produced water transfer, chemicals, carbon pricing, pipeline construction, emissions, hydraulic fracturing, leasing, permitting or drilling on federal lands and various other environmental matters; regional impacts to our business, including our key infrastructure assets within the Permian Basin, the Bakken, and the Haynesville regions; capacity constraints on regional oil, natural gas and water gathering, processing and pipeline systems that result in a slowdown or delay in drilling and completion activity, and thus a decrease in the demand for our services in our core markets; the impact of regulatory and related policy actions by federal, state and/or local governments, such as the Inflation Reduction Act of 2022, which may negatively impact the future production of oil and gas in the U.S., thereby reducing demand for our services; our ability to hire and retain key management and employees, including skilled labor; our access to capital to fund expansions, acquisitions and our working capital needs and our ability to obtain debt or equity financing on satisfactory terms, or at all; our health, safety and environmental performance; the impact of competition on our operations; the degree to which our exploration and production customers may elect to operate their water-management services in-house rather than source these services from companies like us; our level of indebtedness and our ability to comply with covenants contained in our sustainability-linked credit facility or future debt instruments; delays or restrictions in obtaining permits by us or our customers; constraints in supply or availability of equipment used in our business; the impact of advances or changes in well-completion technologies or practices that result in reduced demand for our services, either on a volumetric or time basis; changes in global political or economic conditions, generally, and in the markets we serve, including the rate of inflation and potential economic recession; acts of terrorism, war or political or civil unrest in the U.S. or elsewhere, such as the Russia-Ukraine war, the instability and continued hostilities in the Middle East, including military conflict involving Iran and any potential conflict with Venezuela; information technology failures or cyberattacks; accidents, weather, natural disasters or other events affecting our business; and the other factors discussed or referenced in the "Risk Factors" section of our most recent Annual Report on Form 10-K and those set forth from time to time in our other filings with the SEC. Investors should not place undue reliance on our forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, unless required by law. 1,271 1,2181,049Class B common stock, $0.01 par value112162162Additional paid-in capital1,203,2511,166,419989,329Accumulated deficit (155,283)(176,318)(184,924)Total stockholders' equity1,049,351991,481805,616Noncontrolling interests88,169128,152121,451Total equity1,137,5201,119,633927,067Total liabilities and equity$1,787,741$1,706,875$1,595,612 Comparison of Non-GAAP Financial Measures EBITDA, Adjusted EBITDA, gross profit before depreciation, amortization and accretion ("D&A"), gross margin before D&A and free cash flow are not financial measures presented in accordance with accounting principles generally accepted in the U.S. ("GAAP"). We define EBITDA as net income (loss), plus interest expense, income taxes and depreciation, amortization and accretion. We define Adjusted EBITDA as EBITDA, plus any impairment and abandonment charges or asset write-offs pursuant to GAAP, plus non-cash losses on the sale of assets or subsidiaries, non-cash compensation expense, and non-recurring or unusual expenses or charges, including severance expenses, transaction costs, or facilities-related exit and disposal-related expenditures, plus/(minus) foreign currency losses/(gains), plus/(minus) losses/(gains) on unconsolidated entities plus tax receivable agreements expense and less remeasurement gain on business combination. We define gross profit before D&A as revenue less cost of revenue, excluding cost of sales D&A expense. We define gross margin before D&A as gross profit before D&A divided by revenue. We define free cash flow as net cash provided by (used in) operating activities less purchases of property and equipment, plus proceeds received from sale of property and equipment. EBITDA, Adjusted EBITDA, gross profit before D&A, gross margin before D&A and free cash flow are supplemental non-GAAP financial measures that we believe provide useful information to external users of our financial statements, such as industry analysts, investors, lenders and rating agencies because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense), asset base (such as depreciation, amortization and accretion) and non-recurring items outside the control of our management team. We present EBITDA, Adjusted EBITDA, gross profit before D&A, gross margin before D&A and free cash flow because we believe they provide useful information regarding the factors and trends affecting our business in addition to measures calculated under GAAP. Our board of directors, management and investors use EBITDA and Adjusted EBITDA to assess our financial performance because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense), asset base (such as depreciation, amortization and accretion) and items outside the control of our management team. Net income (loss) is the GAAP measure most directly comparable to EBITDA and Adjusted EBITDA. Gross profit and gross margin are the GAAP measures most directly comparable to gross profit before D&A and gross margin before D&A, respectively. Net cash provided by (used in) operating activities is the GAAP measure most directly comparable to free cash flow. Our non-GAAP financial measures should not be considered as alternatives to the most directly comparable GAAP financial measure. Each of these non-GAAP financial measures has important limitations as an analytical tool due to exclusion of some but not all items that affect the most directly comparable GAAP financial measures. You should not consider EBITDA, Adjusted EBITDA, gross profit before D&A, gross margin before D&A or free cash flow in isolation or as substitutes for an analysis of our results as reported under GAAP. Because EBITDA, Adjusted EBITDA, gross profit before D&A, gross margin before D&A and free cash flow may be defined differently by other companies in our industry, our definitions of these non-GAAP financial measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. For forward-looking non-GAAP measures, the Company is unable to provide a reconciliation of the forward-looking non-GAAP financial measures to their most directly comparable GAAP financial measure as the information necessary for a quantitative reconciliation, including potential acquisition-related transaction costs as well as the purchase price accounting allocation of the recent acquisitions and the resulting impacts to depreciation, amortization and accretion expense, among other items is not available to the Company without unreasonable efforts due to the inherent difficulty and impracticability of predicting certain amounts required by GAAP with a reasonable degree of accuracy at this time. The following table presents a reconciliation of free cash flow to net cash provided by operating activities, which is the most directly comparable GAAP measure for the periods presented: The following table presents a reconciliation of EBITDA and Adjusted EBITDA to our net income, which is the most directly comparable GAAP measure for the periods presented: The following table presents a reconciliation of gross profit before D&A to total gross profit, which is the most directly comparable GAAP measure, and a calculation of gross margin before D&A for the periods presented: Contacts: Select Water Solutions, Inc. Garrett Williams – VP, Corporate Finance & Investor Relations(713) [email protected] Dennard Lascar Investor RelationsKen Dennard / Natalie Hairston(713) [email protected] View original content:https://www.prnewswire.com/news-releases/select-water-solutions-announces-second-quarter-2026-financial-operational-and-strategic-updates-302842923.html