On May 10, 2016, we issued an updated research report on leading oilfield services company, Weatherford International Ltd. WFT.Weatherford lowered its free cash flow guidance for 2016 to $400–$500 million from the earlier projection of $600–$700 million. Further, the company expects revenues and earnings to deteriorate in North America and Latin America during the second quarter of 2016. In short, the company’s short-term picture looks gloomy.Though the company’s expenditure on exploration and production activity levels are gaining traction, we believe that this might be partially offset by competitive pricing and continuing margin pressure from excess capacity. In addition, Weatherford could be more adversely impacted than its peers, if the North American market underperforms. The reason is that a significant portion of its revenues comes from this region. Weatherford believes that the depressed natural gas and oil price environment will be a drag on its earnings.Although secular growth opportunities are available for the company’s new technologies such as Directional drilling and Artificial lift, it may take some time as well as considerable investment in research and development and marketing before the new technologies achieve critical mass.Weatherford’s debt-heavy balance sheet, its incapability to generate strong free cash flow as well as competition from larger peers are causes for concern.However, with crude prices plunging over 50% since Jun 2014, most of the drillers have been compelled to make significant reductions to this year’s capital expenditures. This is expected to hamper Weatherford’s business in 2016 as it assists the drilling firms in setting up oil wells.Nonetheless, the measures undertaken by Weatherford to reduce costs both through direct cost reduction in view of the major downturn as well as its overall cost structure should result in a more efficient and better run company going forward. With revenue trends projected to surpass peers, the company is expected to witness improved earnings performance in 2016.Further, Weatherford is aligning its organizational structure to keep up with the changing market conditions which, in turn, should greatly aid financials. The company is planning to shut down and consolidate several of its operating facilities across North America by the end of this year.Stocks to ConsiderCurrently, Weatherford carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the oil and gas sector include CVR Refining, LP CVRR, Transocean Partners LLC RIGP and Braskem S.A. BAK. All these sport a Zacks Rank #1 (Strong Buy).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 >>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 WEATHERFORD INT (WFT): Free Stock Analysis Report TRANSOCEAN PTN (RIGP): Free Stock Analysis Report BRASKEM SA (BAK): Free Stock Analysis Report CVR REFINING LP (CVRR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research