Liberty Energy, a Denver-based pressure pumper that fractures oil and gas wells across North American shale and owns two Permian sand mines, told investors on 22 July that its 2026 capital budget had climbed to roughly $1.5bn from about $1.2bn. The extra money does not buy pumping equipment. It buys long-lead deposits on gas-fired generators — $71m of them in the second quarter alone, according to the company. The shares fell about 22% the following day despite beating on both revenue and adjusted earnings.

That single decision reframed an entire rung of the oilfield-services chain. The question in this business is no longer how many wells get fractured. It is who pays for the generators, and whether anyone has signed for the electricity.

The core is not shrinking

Liberty's second-quarter revenue was $1.189bn, up 14% from a year earlier and 16% sequentially. Gross margin recovered to 17.5%, from 6.2% in the first quarter and 9.7% a year ago. Below that line the recovery thins out: operating income was $12.7m, down 70% year on year, for an operating margin near 1%. The shares have fallen 38% in three months and have traded in a downtrend since early August, their 50-day average below the 200-day.

The multiple has compressed with it. Liberty changes hands at 0.78 times trailing sales, against 1.36 times in mid-May, and at 7.0 times trailing enterprise value to EBITDA — the cheapest of the group, below Halliburton at 8.5, SLB at 12.5 and Baker Hughes at 13.6. Trailing free cash flow is negative, a yield of -9.6%. Some of the discount is therefore rational: shareholders are funding a build whose flagship, the PowerBridge joint venture serving a 2-gigawatt West Texas campus, expects first power only in the fourth quarter of 2027 and has no customer leases signed. The one named counterparty, Vantage Data Centers, reserved 400 megawatts of 2027 capacity in January. Liberty has locked in 3 gigawatts of equipment through 2029 from Bergen Engines and Wärtsilä, financed partly by $1.3bn of convertible notes and project-level debt.

ProPetro, a Midland-only pumper of roughly $1.5bn market value, is further along on the thing Liberty is promising. Its contracted power book rose to about 350 megawatts from 240 in the quarter, including a 60-megawatt hyperscaler project running live and already profitable. Its fracturing business is expanding too — a twelfth fleet activated in the second quarter, a thirteenth due by the end of the third, with Permian capacity management describes as basically spoken for. Yet revenue of $305.8m was down 6.2% year on year and the company still posted an operating loss of $4.8m. It is the only loss-maker here and carries the highest multiple among the North American pumpers, 9.15 times EBITDA. Brokers cut targets in early August — Citi to $16, Piper Sandler to $18 — while keeping buy ratings.

What the market will pay for

Baker Hughes shows the price of contracted demand. The Houston company's industrial and energy technology arm — liquefaction turbomachinery, where it holds roughly 90% of the market, plus gas turbines — booked record orders of $7.1bn, double last year, a 2.2 times book-to-bill, with obligations yet to be delivered up 19% to $37.1bn. Strip out data centers and orders would still have matched the prior record. None of it is in the income statement yet: reported revenue fell 2.4%. The shares rose 17% in a month to the richest valuation in the group, a 59% premium to Halliburton.

The macro reading is counterintuitive. Brent sits near $93, up more than 37% on the year on Middle East supply disruption the Energy Information Administration expects to persist into 2027. North American completions de-rated anyway, because the binding constraint is producer capital discipline and Henry Hub gas at $2.79, down from $3.00 in May. Halliburton is not defending share at all, pricing its domestic fleet hard while shifting equipment to Argentina and the Middle East; its international revenue grew 6%. SLB, Liberty's announced power partner, is also its competitor — its data-center unit grew 80% year on year and has delivered 1.3 gigawatts. And Select Water Solutions, which recycles and disposes of produced water, signed a seven-year Permian contract with a 128m-barrel minimum commitment; its infrastructure segment earned a record $102m at a 58% gross margin. Its shares, on the longest uptrend in the group, are up 2.8% in three months.

The completions dollar is migrating to water and power. The market is paying for it only where someone has signed.

The setup

Where it stands — Liberty's pumping margins are recovering while its equity prices a self-funded, uncontracted power build; ProPetro's power book is contracted but its operations still lose money. Would confirm — Liberty signing a named lease at the PowerBridge campus, or ProPetro turning an operating profit in the third quarter. Would invalidate — Liberty cutting 2026 capex back toward $1.2bn, or ProPetro's contracted megawatts stalling near 350. Watch next — Third-quarter results in late October, plus ProPetro's promised thirteenth fleet activation by 30 September. Valuation — Liberty at 7.0x trailing EV/EBITDA and 0.72x forward sales, against 1.36x sales in mid-May; Baker Hughes at 13.6x.