Halliburton Results Support Sell Rec

Halliburton Co.'s (HAL - Analyst Report) first-quarter earnings were largely in-line with expectations, though revenue numbers were modestly off. Results were down significantly from the year-earlier level due to the sharp cyclical downturn, particularly in the all-important North American market.

Management indicated continued lack of visibility with respect to the length and depth of the downturn, though they did mention that the North American margin squeeze may be close to bottoming out. But the slide on the international front, admittedly never as severe as in North
America, is just getting underway.

Our Sell recommendation remains unchanged, though we have lowered our estimates. Our new $15 price objective reflects 2009 P/E and EV/EBITDA multiples of 12X and 8.0X, well within historical trading ranges.