Stock of the Day

February 1, 2022

Halliburton (HAL)

$26.25
-$0.75 (-2.8%)
Market Cap: $23.43B

About Halliburton

Halliburton Company provides products and services to the energy industry worldwide. It operates through two segments, Completion and Production, and Drilling and Evaluation. The Completion and Production segment offers production enhancement services that include stimulation and sand control services; cementing services, such as well bonding and casing, and casing equipment; and completion tools that offer downhole solutions and services, including well completion products and services, intelligent well completions, and service tools, as well as liner hanger, sand control, and multilateral systems. This segment also provides electrical submersible pumps, as well as artificial lift services; production solutions comprising coiled tubing, hydraulic workover units, downhole tools, and pumping and nitrogen services; pipeline and process services, such as pre-commissioning, commissioning, maintenance, and decommissioning; and specialty chemicals and services. The Drilling and Evaluation segment offers drilling fluid systems, performance additives, completion fluids, solids control, specialized testing equipment, and waste management services; drilling systems and services; wireline and perforating services consists of open-hole logging, and cased-hole and slickline; and drill bits and services comprising roller cone rock bits, fixed cutter bits, hole enlargement, and related downhole tools and services, as well as coring equipment and services. This segment also provides cloud based digital services and artificial intelligence solutions on an open architecture for subsurface insights, integrated well construction, and reservoir and production management; testing and subsea services, such as acquisition and analysis of reservoir information and optimization solutions; and project management and integrated asset management services. Halliburton Company was founded in 1919 and is based in Houston, Texas.

Halliburton Bull Case

Here are some ways that investors could benefit from investing in Halliburton:

  • Halliburton has a strong market capitalization of approximately $22.70 billion, indicating a solid position in the oilfield services industry, which can provide stability and growth potential for investors.
  • The company recently announced a quarterly dividend of $0.17, translating to an annualized yield of 2.60%. This consistent dividend payment can be attractive for income-focused investors.
  • Recent institutional investments, including a new stake by Strategic Financial Concepts LLC valued at approximately $728,000, suggest growing confidence in Halliburton's future performance.
  • Halliburton's current stock price is around $26.16, which is significantly lower than its 12-month high of $41.56, potentially offering a buying opportunity for investors looking for undervalued stocks.
  • The company has a relatively low P/E ratio of 9.24, which may indicate that the stock is undervalued compared to its earnings, making it an appealing option for value investors.

Halliburton Bear Case

Investors should be bearish about investing in Halliburton for these reasons:

  • Analysts have recently reduced their Q1 2025 EPS estimates from $0.71 to $0.61, indicating potential challenges in achieving expected earnings growth.
  • Several research firms have lowered their target prices for Halliburton, with Benchmark reducing it from $40.00 to $35.00, which may reflect a bearish outlook on the stock's future performance.
  • The stock has experienced volatility, with a beta of 1.89, suggesting that it is more volatile than the market, which could pose risks for conservative investors.
  • Despite a strong market presence, Halliburton's debt-to-equity ratio of 0.68 indicates a reliance on debt financing, which could be a concern if market conditions worsen.
  • With hedge funds and institutional investors owning 85.23% of the company's stock, retail investors may find it challenging to influence the stock's direction, potentially limiting their investment impact.

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