Halliburton’s Q4 Revenue Falls Short, Goldman Sachs Analyst Raises Questions
Disappointing Earnings Report
Halliburton Company (NYSE:HAL) shares took a hit on Wednesday after the company reported a 2.3% year-over-year decline in fourth-quarter revenue, missing the consensus estimate of $5.63 billion. The revenue shortfall was largely attributed to a 4.2% drop in Completion and Production revenue, which fell to $3.2 billion.
Goldman Sachs Analyst Weighs In
Goldman Sachs analyst Neil Mehta reiterated his Buy rating on the stock, with a price target of $36. Mehta noted that the softer revenue was partially offset by a strong performance in Drilling and Evaluation. However, he expressed uncertainty about the company’s 2025 revenue growth prospects, particularly in the international market.
Free Cash Flow Beats Estimates
On a positive note, Halliburton reported free cash flow of $1.104 billion, surpassing Mehta’s estimate of $930 million and the consensus of $1.045 billion. This beat was driven by better working capital management and lower capital expenditures.
Share Repurchases and Capital Returns
During the quarter, Halliburton repurchased approximately $309 million in common stock, in line with Mehta’s estimate of $310 million. However, the analyst raised questions about how the company should approach capital returns in 2025.
Uncertainty Surrounds Long-Term Margin Expansion
Mehta also expressed ambiguity about Halliburton’s ability to expand margins in a flat activity environment. Furthermore, he sought clarity on the company’s future participation in the power space, including its partnership with VoltaGrid.
Price Action
HAL shares were trading lower by 1.51% to $29.09 at last check on Wednesday.
Analyst Ratings and Price Targets
Halliburton has received a range of analyst ratings and price targets, including Overweight ratings from Morgan Stanley and JP Morgan. View the latest analyst ratings and price targets for HAL.
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