Baker Hughes Company (NASDAQ:BKR) Barclays 38th Annual CEO Energy-Power Conference Call September 4, 2024 8:35 AM ET Company Participants Lorenzo Simonelli - Chief Executive Officer Conference Call Participants Dave Anderson - Barclays Dave Anderson Since the merger of the GE Oil & Gas and Baker Hughes, we've been fortunate with our front-row seat to the company's transformation as they've used our conference to roll out its annual presentation and evolving strategy each year. So, it's been an impressive jo ...

Amerino Gatti appointed as executive vice president of Oilfield Services & Equipment (OFSE) business segment Maria Claudia Borras appointed as chief growth & experience officer Muzzamil Khider Ahmed appointed as chief people & culture officer HOUSTON and LONDON, Sept. 03, 2024 (GLOBE NEWSWIRE) -- Baker Hughes Company (NASDAQ: BKR) ("Baker Hughes" or the "Company") announced Tuesday several changes to its leadership team, effective by Oct. 1. These changes are designed to continue delivering Baker Hughes' su ...

Baker Hughes (BKR) closed the last trading session at $34.51, gaining 1% over the past four weeks, but there could be plenty of upside left in the stock if short-term price targets set by Wall Street analysts are any guide. The mean price target of $43.25 indicates a 25.3% upside potential. The mean estimate comprises 20 short-term price targets with a standard deviation of $2.92. While the lowest estimate of $37 indicates a 7.2% increase from the current price level, the most optimistic analyst expects the ...

Core Viewpoint - Baker Hughes experienced a significant stock increase of 10.1% in July, driven by strong earnings reflecting operational improvements and margin expansion, alongside robust order growth in industrial and energy technology [2] Margin Expansion - Baker Hughes operates in two segments: Industrial and Energy Technology (IET) and Oilfield Services and Equipment (OFSE) [3] - Management aims to increase OFSE EBITDA margin from 16.9% to 20% by 2025 and IET EBITDA margin from 15% to 20% by 2026 [4] - Recent margin performance showed year-over-year and sequential expansion in both segments, with Q2 2023 OFSE margin at 16.4% and IET margin at 14.9% [5] Order Growth - The company reported $7.5 billion in orders for the quarter, surpassing revenue of $7.1 billion, with $3.5 billion in IET orders [6] - Non-LNG orders reached a record of $1.4 billion this quarter, while new energy orders hit a record $445 million, totaling $684 million for the first half of the year [7] Future Outlook - With ongoing margin expansion and strong order growth, Baker Hughes is positioned for a robust 2024, particularly in LNG investments and new energy solutions [8]

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers. Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by th ...

Baker Hughes (BKR) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company. The upward trend in estimate revisions for this oilfield services company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation ...

The Oils-Energy group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Baker Hughes (BKR) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Oils-Energy sector should help us answer this question. Baker Hughes is one of 247 companies in the Oils-Energy group. The Oil ...

Core Viewpoint - Growth investors are increasingly focused on identifying stocks with above-average financial growth, which can lead to solid returns, but finding such stocks is challenging due to inherent volatility and risks [1] Group 1: Company Overview - Baker Hughes (BKR) is currently highlighted as a recommended growth stock by the Zacks Growth Style Score system, which evaluates a company's growth prospects beyond traditional metrics [2] - The stock has a favorable Growth Score and a top Zacks Rank, indicating strong potential for growth [2] Group 2: Earnings Growth - Historical EPS growth for Baker Hughes stands at 47.6%, with projected EPS growth of 36.6% for the current year, significantly outperforming the industry average of 11.2% [5] - Earnings growth is a critical factor for growth investors, with double-digit growth being particularly desirable [4] Group 3: Cash Flow Growth - Baker Hughes has a year-over-year cash flow growth rate of 37.9%, surpassing the industry average of 18.8%, which is crucial for funding business expansion without relying on external financing [6] - The company's historical annualized cash flow growth rate over the past 3-5 years is 8.9%, compared to an industry average of 0% [7] Group 4: Earnings Estimate Revisions - There has been a positive trend in earnings estimate revisions for Baker Hughes, with the Zacks Consensus Estimate for the current year increasing by 4.5% over the past month [8] - Positive earnings estimate revisions are correlated with near-term stock price movements, making this trend significant for investors [8] Group 5: Investment Positioning - Baker Hughes has achieved a Zacks Rank of 2 (Buy) and a Growth Score of B, positioning it well for potential outperformance in the market [9] - The combination of strong earnings growth, cash flow growth, and positive earnings estimate revisions makes Baker Hughes an attractive option for growth investors [9]

Company Performance - Baker Hughes (BKR) shares have increased by 10.2% over the past month, reaching a new 52-week high of $38.67 [1] - Year-to-date, the stock has gained 11.9%, outperforming the Zacks Oils-Energy sector's 5.7% and the Zacks Oil and Gas - Field Services industry's 3.3% [1] Earnings and Revenue Expectations - Baker Hughes has consistently exceeded earnings estimates, reporting an EPS of $0.57 against a consensus estimate of $0.49 in its last earnings report on July 25, 2024 [2] - For the current fiscal year, the company is projected to achieve earnings of $2.19 per share on revenues of $27.82 billion, reflecting a 36.88% increase in EPS and a 9.06% increase in revenues [3] - The next fiscal year is expected to see earnings of $2.62 per share on $29.15 billion in revenues, indicating a year-over-year change of 19.84% in EPS and 4.8% in revenues [3] Valuation Metrics - Baker Hughes has a Value Score of B, a Growth Score of B, and a Momentum Score of A, resulting in a combined VGM Score of A [6] - The stock trades at 17.5X current fiscal year EPS estimates, below the peer industry average of 19.7X, and at 14.1X trailing cash flow compared to the peer group's average of 7.6X [7] - The PEG ratio stands at 0.62, indicating that while the stock is not in the top echelon from a value perspective, it still presents a reasonable valuation [7] Zacks Rank - Baker Hughes holds a Zacks Rank of 2 (Buy), supported by favorable earnings estimate revisions from analysts [8] - The recommendation suggests that investors should consider stocks with a Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, positioning Baker Hughes as a potential investment opportunity [9] Industry Comparison - The Oil and Gas - Field Services industry ranks in the bottom 86% of all industries, yet Baker Hughes and TechnipFMC plc (FTI) show promising fundamentals and potential tailwinds [12] - TechnipFMC plc has also demonstrated strong performance, with a Zacks Rank of 2 (Buy) and expected earnings of $1.21 per share on revenues of $9 billion for the current fiscal year [10]

Investment Rating - The investment rating for Baker Hughes is "Outperform" based on the expected performance relative to the market benchmark [3][23]. Core Insights - Baker Hughes reported an adjusted net EBITDA of $1.13 billion for Q2 2024, exceeding market expectations and guidance [1][33]. - The company raised its revenue guidance for FY 2024 to a midpoint increase of 5%, with previous revenue guidance set at $26.5-28.5 billion [1][33]. - The overall revenue for Q2 2024 was $7.14 billion, reflecting a 13% year-over-year increase, driven by strong performance across all segments, particularly in the Industrial and Energy Technology sector, which grew by 59% [1][33][34]. Summary by Sections Financial Performance - For Q2 2024, total revenue was $7.14 billion, up 13% year-over-year, with adjusted EBITDA at $1.13 billion, a 25% increase from the previous year [21][33]. - The EBITDA margin for Q2 2024 was reported at 15.8%, aligning with market expectations [1][33]. Segment Performance - The Oilfield Services and Equipment segment generated revenue of $4.01 billion, a 3% increase year-over-year, with an EBITDA margin of 17.9% [19][21]. - The Industrial and Energy Technology segment reported revenue of $3.13 billion, a 28% increase year-over-year, with an EBITDA margin of 15.9% [34]. Guidance and Expectations - The company has not provided specific tax rate guidance for FY 2024, which is expected to be in the range of 27-32% [1]. - The overall positive performance and raised guidance suggest a favorable outlook for Baker Hughes in the upcoming quarters [1][33].