Overview of Halliburton (HAL) 3rd quarter 2021 earnings
Category: Halliburton (HAL)
Date: 20 October 2021 Stock price of Halliburton (HAL): $26.10 Market Capital of Halliburton (HAL): $23.2 billion We take a look at the 3rd quarter 2021 earnings report of Halliburton (HAL), one of the largest product and services providers to the energy industry. For the quarter the group reported revenues of $3.85 billion and net income of $236 million.
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Our third quarter performance demonstrates the effectiveness of both our strategy and our execution. Total company revenue increased 4% sequentially, and adjusted operating income grew 6% with solid margins in both divisions - Jeff Miller, Chairman, President and CEO. "
More About Halliburton (HAL)
Founded in 1919, Halliburton is one of the world's largest providers of products and services to the energy industry. With more than 40,000 employees, representing 130 nationalities in more than 70 countries, the company helps its customers maximize value throughout the lifecycle of the reservoir – from locating hydrocarbons and managing geological data, to drilling and formation evaluation, well construction and completion, and optimizing production throughout the life of the asset
Overview of Halliburton (HAL) 3rd quarter 2021 earnings
- Reported net income of $0.26 per diluted share
- Adjusted net income of $0.28 per diluted share
- Cash flow from operating activities of $617 million and free cash flow of $469 million
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Halliburton (HAL) management commentary 3rd quarter 2021 earnings report
HOUSTON--(BUSINESS WIRE)--Oct. 19, 2021-- Halliburton Company (NYSE: HAL) announced today net income of $236 million, or $0.26 per diluted share, for the third quarter of 2021. This compares to net income for the second quarter of 2021 of $227 million, or $0.26 per diluted share. Adjusted net income for the third quarter of 2021, excluding special items, was $248 million, or $0.28 per diluted share. Halliburton's total revenue for the third quarter of 2021 was $3.9 billion compared to revenue of $3.7 billion in the second quarter of 2021. Reported operating income was $446 million in the third quarter of 2021 compared to reported operating income of $434 million in the second quarter of 2021. Excluding special items, adjusted operating income was $458 million in the third quarter of 2021.
“Our third quarter performance demonstrates the effectiveness of both our strategy and our execution. Total company revenue increased 4% sequentially, and adjusted operating income grew 6% with solid margins in both divisions,” commented Jeff Miller, Chairman, President and CEO.
“Both operating divisions experienced revenue growth in the international and North America Land markets. Our Completion and Production division delivered solid mid-teens margins, and our Drilling and Evaluation division margins maintained their steady momentum.
“I am pleased with our strengthening free cash flow profile. In the third quarter, we generated $469 million of free cash flow, retired $500 million of debt, and maintained our cash balance at $2.6 billion. I see a multi-year upcycle unfolding. Structural global commodity tightness drives increased demand for our services, both internationally and in North America. I believe Halliburton is uniquely positioned in both markets to benefit from this improving environment. I believe our value proposition, technology differentiation, digital adoption, and capital efficiency will allow us to deliver profitable growth internationally and maximize value in North America. Halliburton will continue to execute our key strategic priorities to deliver industry-leading returns and strong free cash flow for our shareholders,” concluded Miller.
“Both operating divisions experienced revenue growth in the international and North America Land markets. Our Completion and Production division delivered solid mid-teens margins, and our Drilling and Evaluation division margins maintained their steady momentum.
“I am pleased with our strengthening free cash flow profile. In the third quarter, we generated $469 million of free cash flow, retired $500 million of debt, and maintained our cash balance at $2.6 billion. I see a multi-year upcycle unfolding. Structural global commodity tightness drives increased demand for our services, both internationally and in North America. I believe Halliburton is uniquely positioned in both markets to benefit from this improving environment. I believe our value proposition, technology differentiation, digital adoption, and capital efficiency will allow us to deliver profitable growth internationally and maximize value in North America. Halliburton will continue to execute our key strategic priorities to deliver industry-leading returns and strong free cash flow for our shareholders,” concluded Miller.
Halliburton (HAL) stock price history over the last 5 years
The image below shows the stock price history of Halliburton (HAL) over the last 5 years. And its not been a good time for stockholders with the stock decreasing sharply by -45.6% over the last 5 years.
The stock of Halliburton is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Halliburton stock is positive at this point in time.
The stock of Halliburton is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Halliburton stock is positive at this point in time.
Latest stock valuation of Halliburton (HAL)
So what is Halliburton (HAL) stock worth based on their 3rd quarter 2021 earnings report? Based on their earnings report our valuation model provides a target price (full value price) for Halliburton (HAL) at $18.40 a stock
We therefore believe the stock of Halliburton (HAL) is overvalued at its current price of $26.10
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price), which in this case is $18.40, thus a good entry point into Halliburton (HAL) would be at $16.30 or below.
We expect the stock of Halliburton to pull back from current levels in coming weeks and months to levels closer to our target price (full value price), as their stock is price is overvalued
We therefore believe the stock of Halliburton (HAL) is overvalued at its current price of $26.10
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price), which in this case is $18.40, thus a good entry point into Halliburton (HAL) would be at $16.30 or below.
We expect the stock of Halliburton to pull back from current levels in coming weeks and months to levels closer to our target price (full value price), as their stock is price is overvalued
Next earnings release of Halliburton (HAL)
It is expected that Halliburton (HAL) will release their 4th quarter 2021 earnings report in late January 2022
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