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Halliburton (HAL) Headed for Strong Q3 Earnings: Know Why
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Halliburton Company (HAL - Free Report) is set to release third-quarter results on Oct 25. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 56 cents per share on revenues of $5.3 billion.
Let’s delve into the factors that might have influenced the oilfield service firm’s performance in the September quarter. But it’s worth taking a look at HAL’s previous-quarter performance first.
Highlights of Q2 Earnings & Surprise History
In the last reported quarter, this Houston, TX-based provider of technical products and services to drillers of oil and gas wells beat the consensus mark on stronger-than-expected profit from both its divisions. Halliburton had reported adjusted net income per share of 49 cents, higher than the Zacks Consensus Estimate of 45 cents. Revenues of $5.1 billion also came ahead of the Zacks Consensus Estimate by 7.7%.
HAL beat the Zacks Consensus Estimate in two of the last four quarters, which resulted in an earnings surprise of 3.7%, on average. This is depicted in the graph below:
The Zacks Consensus Estimate for the third-quarter bottom line has remained unchanged in the past seven days. The estimated figure indicates a 100% improvement year over year. The Zacks Consensus Estimate for revenues suggests a 38.1% increase from the year-ago period.
Factors to Consider
Despite pulling back from their multi-year highs, oil and natural gas prices have remained robust. In fact, they are trading considerably higher year to date due to rising demand and geopolitical tensions. Consequently, drilling activity — an important factor for services companies — has been picking up. In the United States, a region on which Halliburton is highly dependent, rig count at the end of the third quarter was 765 compared with 753 three months ago and 521 a year back, in sync with the strength in commodity prices. The number of active units in Canada and the international markets has gained sharply too. The steady growth in rig count is an encouraging indicator of contracting activity.
Considering the improved operating environment, the Zacks Consensus Estimate for the third-quarter operating income of Completion & Production and Drilling & Evaluation is pegged at $536 million and $308 million, respectively, indicating an increase of 66.5% and 65.6% year over year.
Why a Likely Positive Surprise?
Our proven model predicts an earnings beat for Halliburton this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Halliburton has an Earnings ESP of +1.54% and a Zacks Rank #2.
Other Stocks to Consider
Halliburton is not the only energy company looking up this earnings cycle. Here are some other firms from the space that you may want to consider on the basis of our model:
Murphy USA (MUSA - Free Report) has an Earnings ESP of +12.68% and a Zacks Rank #1. The firm is scheduled to release earnings on Oct 26.
For 2022, Murphy USA has a projected earnings growth rate of 69.6%. Valued at around $6.6 billion, MUSA has gained 65% in a year.
PBF Energy (PBF - Free Report) has an Earnings ESP of +10.30% and a Zacks Rank #2. The firm is scheduled to release earnings on Oct 27.
PBF topped the Zacks Consensus Estimate by an average of 78% in the trailing four quarters, including a 43.8% beat in Q2. PBF has gained 179.8% in a year.
Oceaneering International (OII - Free Report) has an Earnings ESP of +50% and a Zacks Rank #2. The firm is scheduled to release earnings on Oct 26.
The Zacks Consensus Estimate for OII’s 2022 earnings has been revised 33.3% upward over the past 60 days. Valued at around $905.3 million, Oceaneering International has lost 37.4% in a year.
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Halliburton (HAL) Headed for Strong Q3 Earnings: Know Why
Halliburton Company (HAL - Free Report) is set to release third-quarter results on Oct 25. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 56 cents per share on revenues of $5.3 billion.
Let’s delve into the factors that might have influenced the oilfield service firm’s performance in the September quarter. But it’s worth taking a look at HAL’s previous-quarter performance first.
Highlights of Q2 Earnings & Surprise History
In the last reported quarter, this Houston, TX-based provider of technical products and services to drillers of oil and gas wells beat the consensus mark on stronger-than-expected profit from both its divisions. Halliburton had reported adjusted net income per share of 49 cents, higher than the Zacks Consensus Estimate of 45 cents. Revenues of $5.1 billion also came ahead of the Zacks Consensus Estimate by 7.7%.
HAL beat the Zacks Consensus Estimate in two of the last four quarters, which resulted in an earnings surprise of 3.7%, on average. This is depicted in the graph below:
Halliburton Company Price and EPS Surprise
Halliburton Company price-eps-surprise | Halliburton Company Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for the third-quarter bottom line has remained unchanged in the past seven days. The estimated figure indicates a 100% improvement year over year. The Zacks Consensus Estimate for revenues suggests a 38.1% increase from the year-ago period.
Factors to Consider
Despite pulling back from their multi-year highs, oil and natural gas prices have remained robust. In fact, they are trading considerably higher year to date due to rising demand and geopolitical tensions. Consequently, drilling activity — an important factor for services companies — has been picking up. In the United States, a region on which Halliburton is highly dependent, rig count at the end of the third quarter was 765 compared with 753 three months ago and 521 a year back, in sync with the strength in commodity prices. The number of active units in Canada and the international markets has gained sharply too. The steady growth in rig count is an encouraging indicator of contracting activity.
Considering the improved operating environment, the Zacks Consensus Estimate for the third-quarter operating income of Completion & Production and Drilling & Evaluation is pegged at $536 million and $308 million, respectively, indicating an increase of 66.5% and 65.6% year over year.
Why a Likely Positive Surprise?
Our proven model predicts an earnings beat for Halliburton this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Halliburton has an Earnings ESP of +1.54% and a Zacks Rank #2.
Other Stocks to Consider
Halliburton is not the only energy company looking up this earnings cycle. Here are some other firms from the space that you may want to consider on the basis of our model:
Murphy USA (MUSA - Free Report) has an Earnings ESP of +12.68% and a Zacks Rank #1. The firm is scheduled to release earnings on Oct 26.
You can see the complete list of today’s Zacks #1 Rank stocks here.
For 2022, Murphy USA has a projected earnings growth rate of 69.6%. Valued at around $6.6 billion, MUSA has gained 65% in a year.
PBF Energy (PBF - Free Report) has an Earnings ESP of +10.30% and a Zacks Rank #2. The firm is scheduled to release earnings on Oct 27.
PBF topped the Zacks Consensus Estimate by an average of 78% in the trailing four quarters, including a 43.8% beat in Q2. PBF has gained 179.8% in a year.
Oceaneering International (OII - Free Report) has an Earnings ESP of +50% and a Zacks Rank #2. The firm is scheduled to release earnings on Oct 26.
The Zacks Consensus Estimate for OII’s 2022 earnings has been revised 33.3% upward over the past 60 days. Valued at around $905.3 million, Oceaneering International has lost 37.4% in a year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.