Baker Hughes Shows Promising Growth Ahead of Q4 Earnings Report
Houston, Texas-based Baker Hughes Company (BKR) is a leader in providing advanced technologies for cleaner and more efficient energy solutions. With a market capitalization of $42.4 billion, Baker Hughes stands as one of the largest oilfield service providers globally, operating through its Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET) segments.
Upcoming Earnings: Analysts Expect Strong Performance
The company is scheduled to announce its fourth-quarter earnings on Thursday, January 30, after market closure. Analysts predict Baker Hughes will post a non-GAAP profit of $0.63 per share. This marks a significant 23.5% increase compared to $0.51 per share from the previous year. Notably, Baker Hughes has consistently exceeded Wall Street’s earnings expectations for the past four quarters.
Positive Outlook for Fiscal 2024 and Beyond
For the full fiscal year of 2024, projections indicate Baker Hughes will achieve an adjusted EPS of $2.29, showcasing impressive 43.1% growth from $1.60 in fiscal 2023. The outlook continues with expectations for 2025, where earnings are forecasted to rise by 12.2% year-over-year to reach $2.57.
BKR Stock Performance Outshines Market
BKR stock has experienced a remarkable 29.9% increase over the past 52 weeks, outperforming the S&P 500 Index, which rose 25.8%, and the Energy Select Sector SPDR Fund, which saw only 3.9% growth in the same period.
Quarterly Highlights and Market Reactions
Following the mixed results released on October 22 for Q3, Baker Hughes stock jumped over 2.8%. The company reported total revenues of $6.9 billion, reflecting a 4% year-over-year increase. Although this fell short of Wall Street’s expectations, Q3 demonstrated another record quarter for EBITDA, showcasing strong operational performance across both segments. The company exhibited strict expense management, resulting in a significant 268 basis points increase in adjusted EBITDA margin to 17.5%. Adjusted EBITDA also rose impressively by 22.9% year-over-year to $1.2 billion.
Baker Hughes’ adjusted net income surged 56% from the previous year, reaching $666 million. Furthermore, its adjusted EPS of $0.67 exceeded analysts’ expectations by 11.7%, as the company remains optimistic about achieving its full-year earnings targets.
Analyst Consensus: Strong Buy Recommendations
The consensus among analysts on BKR stock is highly favorable, with an overall “Strong Buy” rating. Among the 23 analysts monitoring the stock, 19 suggest a “Strong Buy,” one recommends a “Moderate Buy,” and three advise a “Hold.” The mean price target is set at $47.61, indicating a potential upside of 9.7% from current prices.
On the date of publication, Aditya Sarawgi did not hold (either directly or indirectly) any positions in the securities mentioned in this article. All information and data in this article are provided solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
