ChampionX Earnings: New Product Adoption Contributed to Improved Profitability

No-moat ChampionX posted solid first-quarter results, with revenue increasing 10% year over year and firmwide adjusted EBITDA margin increasing 400 basis points over the same period. Sequentially, top-line growth dropped 4% due to standard seasonality in the firm’s non-North American markets, yet the firm’s adjusted EBITDA margin jumped 40 basis points owing to favorable pricing movements and internal productivity gains. We remain optimistic regarding ChampionX’s 2023 prospects and thus maintain our $33 fair value estimate following results.