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Here's Why Hold Strategy is Apt for Baker Hughes (BKR) Stock
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Baker Hughes Company (BKR - Free Report) has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 60 days. The Zacks Consensus Estimate for its 2022 earnings per share suggests a year-over-year surge of 47.6%.
What's Favoring the Stock?
The West Texas Intermediate crude price is trading at more than the $70-per-barrel mark, which is still highly favorable for exploration and production activities. Solid oil prices will likely pave the way for further rig additions despite a slowdown in drilling activities, as upstream players mainly focus on stockholder returns rather than boosting output. This means higher exploration and production activities, leading to improved demand for oilfield service players like Baker Hughes, currently carrying a Zacks Rank #3 (Hold).
Baker Hughes is also committed to returning capital to shareholders. Compared to composite stocks belonging to the industry, BKR has been consistently paying higher dividend yields over the past two years.
BKR also has a strong balance sheet. Debt-to-capitalization ratio of Baker Hughes has consistently been lower than the composite stocks belonging to the industry over the past two years.
Risks
The oilfield service player is strongly exposed to extreme volatility in oil and natural gas prices. Also, the increasing cost of revenue and rising restructuring, impairment and other expenses are hurting BKR’s bottom line.
Halliburton is a well-known name in providing products and services to energy companies. Over the past seven days, Halliburton has witnessed upward earnings estimate revisions for 2022 and 2023, respectively.
Leveraging on its consolidated global portfolio, Eni is ensuring to supply energy, especially natural gas, to Italy and Europe. Eni is also leading energy transitions with a commitment to reducing net greenhouse gas emissions to zero by 2050.
NexTier Oilfield Solutionsis also a well-known U.S. land oilfield service player. With higher exploration and production by upstream companies, demand for NEX’s diverse set of well completion and production services is handsome.
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Here's Why Hold Strategy is Apt for Baker Hughes (BKR) Stock
Baker Hughes Company (BKR - Free Report) has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 60 days. The Zacks Consensus Estimate for its 2022 earnings per share suggests a year-over-year surge of 47.6%.
What's Favoring the Stock?
The West Texas Intermediate crude price is trading at more than the $70-per-barrel mark, which is still highly favorable for exploration and production activities. Solid oil prices will likely pave the way for further rig additions despite a slowdown in drilling activities, as upstream players mainly focus on stockholder returns rather than boosting output. This means higher exploration and production activities, leading to improved demand for oilfield service players like Baker Hughes, currently carrying a Zacks Rank #3 (Hold).
Baker Hughes is also committed to returning capital to shareholders. Compared to composite stocks belonging to the industry, BKR has been consistently paying higher dividend yields over the past two years.
BKR also has a strong balance sheet. Debt-to-capitalization ratio of Baker Hughes has consistently been lower than the composite stocks belonging to the industry over the past two years.
Risks
The oilfield service player is strongly exposed to extreme volatility in oil and natural gas prices. Also, the increasing cost of revenue and rising restructuring, impairment and other expenses are hurting BKR’s bottom line.
Stocks to Consider
Prospective players in the energy space include Halliburton Company (HAL - Free Report) , Eni SpA (E - Free Report) and NexTier Oilfield Solutions Inc. . All the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Halliburton is a well-known name in providing products and services to energy companies. Over the past seven days, Halliburton has witnessed upward earnings estimate revisions for 2022 and 2023, respectively.
Leveraging on its consolidated global portfolio, Eni is ensuring to supply energy, especially natural gas, to Italy and Europe. Eni is also leading energy transitions with a commitment to reducing net greenhouse gas emissions to zero by 2050.
NexTier Oilfield Solutionsis also a well-known U.S. land oilfield service player. With higher exploration and production by upstream companies, demand for NEX’s diverse set of well completion and production services is handsome.