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Why Is Baker Hughes (BKR) Up 0.3% Since Last Earnings Report?
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It has been about a month since the last earnings report for Baker Hughes (BKR - Free Report) . Shares have added about 0.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Baker Hughes due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Baker Hughes Q2 Earnings & Revenue Miss Estimates
Baker Hughes reported second-quarter 2022 adjusted earnings of 11 cents per share, missing the Zacks Consensus Estimate of 22 cents. However, the bottom line improved from the year-ago quarter’s earnings of 10 cents per share.
Total quarterly revenues of $5,047 million missed the Zacks Consensus Estimate of $5,372 million. The top line also declined from the year-ago quarter’s $5,142 million.
Lower-than-expected earnings were primarily caused by a decline in cost productivity and inflation pressures in Digital Solutions. This was offset by higher contributions from the Oilfield Services business unit.
Segmental Performance
Revenues from the Oilfield Services unit amounted to $2,689 million, up 14% from the year-ago quarter’s $2,358 million. Baker Hughes’ operating income from the segment was $261 million, up from $171 million reported in second-quarter 2021, backed by higher volumes and prices.
Revenues of Baker Hughes from the Oilfield Equipment unit totaled $541 million, down 15% from the prior-year quarter’s $637 million. The segment was affected by a decline in volumes in Baker Hughes’ Subsea Productions Systems and Surface Pressure Control Projects. Increased volumes in Flexibles and Services partially offset the negatives. The segment reported a loss of $12 million, turning around from a profit of $28 million in second-quarter 2021.
Revenues of Baker Hughes from the Turbomachinery & Process Solutions unit declined to $1,293 million from $1,628 million a year ago due to a dip in equipment and project revenues. The segmental income of Baker Hughes decreased to $218 million from $220 million in the second quarter of 2021, owing to lower service revenues.
Revenues of Baker Hughes from the Digital Solutions segment amounted to $524 million, up from $520 million in the year-ago quarter. Waygate Technologies, and the Process and Pipeline Services businesses witnessed higher volumes that supported revenue growth. The operating profit of Baker Hughes in the segment totaled $18 million, down 28% from the year-ago quarter’s $25 million. The segment was affected by a decline in cost productivity and inflation pressures.
Costs and Expenses
Baker Hughes recorded total costs and expenses of $5,072 million in the second quarter, up from the year-ago quarter’s $4,948 million.
Orders
Total orders of the company from all business segments in second-quarter 2022 amounted to $5,860 million, up 15% year over year due to higher order intakes from segments like Turbomachinery & Process Solutions, Oilfield Equipment, Oilfield Services and Digital Solutions.
Free Cash Flow
Baker Hughes generated a free cash flow of $147 million in the reported quarter compared with $385 million in the year-ago period.
Capex & Balance Sheet
Baker Hughes’ net capital expenditure in the second quarter totaled $174 million.
As of Jun 30, 2022, Baker Hughes had cash and cash equivalents of $2,928 million. At the second-quarter end, the company had long-term debt of $6,625 million, implying a debt-to-capitalization of 30.6%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -24.62% due to these changes.
VGM Scores
At this time, Baker Hughes has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Baker Hughes has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Baker Hughes belongs to the Zacks Oil and Gas - Field Services industry. Another stock from the same industry, Halliburton (HAL - Free Report) , has gained 6% over the past month. More than a month has passed since the company reported results for the quarter ended June 2022.
Halliburton reported revenues of $5.07 billion in the last reported quarter, representing a year-over-year change of +36.9%. EPS of $0.49 for the same period compares with $0.26 a year ago.
Halliburton is expected to post earnings of $0.54 per share for the current quarter, representing a year-over-year change of +92.9%. Over the last 30 days, the Zacks Consensus Estimate has changed -2.9%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Halliburton. Also, the stock has a VGM Score of B.
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Why Is Baker Hughes (BKR) Up 0.3% Since Last Earnings Report?
It has been about a month since the last earnings report for Baker Hughes (BKR - Free Report) . Shares have added about 0.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Baker Hughes due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Baker Hughes Q2 Earnings & Revenue Miss Estimates
Baker Hughes reported second-quarter 2022 adjusted earnings of 11 cents per share, missing the Zacks Consensus Estimate of 22 cents. However, the bottom line improved from the year-ago quarter’s earnings of 10 cents per share.
Total quarterly revenues of $5,047 million missed the Zacks Consensus Estimate of $5,372 million. The top line also declined from the year-ago quarter’s $5,142 million.
Lower-than-expected earnings were primarily caused by a decline in cost productivity and inflation pressures in Digital Solutions. This was offset by higher contributions from the Oilfield Services business unit.
Segmental Performance
Revenues from the Oilfield Services unit amounted to $2,689 million, up 14% from the year-ago quarter’s $2,358 million. Baker Hughes’ operating income from the segment was $261 million, up from $171 million reported in second-quarter 2021, backed by higher volumes and prices.
Revenues of Baker Hughes from the Oilfield Equipment unit totaled $541 million, down 15% from the prior-year quarter’s $637 million. The segment was affected by a decline in volumes in Baker Hughes’ Subsea Productions Systems and Surface Pressure Control Projects. Increased volumes in Flexibles and Services partially offset the negatives. The segment reported a loss of $12 million, turning around from a profit of $28 million in second-quarter 2021.
Revenues of Baker Hughes from the Turbomachinery & Process Solutions unit declined to $1,293 million from $1,628 million a year ago due to a dip in equipment and project revenues. The segmental income of Baker Hughes decreased to $218 million from $220 million in the second quarter of 2021, owing to lower service revenues.
Revenues of Baker Hughes from the Digital Solutions segment amounted to $524 million, up from $520 million in the year-ago quarter. Waygate Technologies, and the Process and Pipeline Services businesses witnessed higher volumes that supported revenue growth. The operating profit of Baker Hughes in the segment totaled $18 million, down 28% from the year-ago quarter’s $25 million. The segment was affected by a decline in cost productivity and inflation pressures.
Costs and Expenses
Baker Hughes recorded total costs and expenses of $5,072 million in the second quarter, up from the year-ago quarter’s $4,948 million.
Orders
Total orders of the company from all business segments in second-quarter 2022 amounted to $5,860 million, up 15% year over year due to higher order intakes from segments like Turbomachinery & Process Solutions, Oilfield Equipment, Oilfield Services and Digital Solutions.
Free Cash Flow
Baker Hughes generated a free cash flow of $147 million in the reported quarter compared with $385 million in the year-ago period.
Capex & Balance Sheet
Baker Hughes’ net capital expenditure in the second quarter totaled $174 million.
As of Jun 30, 2022, Baker Hughes had cash and cash equivalents of $2,928 million. At the second-quarter end, the company had long-term debt of $6,625 million, implying a debt-to-capitalization of 30.6%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -24.62% due to these changes.
VGM Scores
At this time, Baker Hughes has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Baker Hughes has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Baker Hughes belongs to the Zacks Oil and Gas - Field Services industry. Another stock from the same industry, Halliburton (HAL - Free Report) , has gained 6% over the past month. More than a month has passed since the company reported results for the quarter ended June 2022.
Halliburton reported revenues of $5.07 billion in the last reported quarter, representing a year-over-year change of +36.9%. EPS of $0.49 for the same period compares with $0.26 a year ago.
Halliburton is expected to post earnings of $0.54 per share for the current quarter, representing a year-over-year change of +92.9%. Over the last 30 days, the Zacks Consensus Estimate has changed -2.9%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for Halliburton. Also, the stock has a VGM Score of B.