An analyst sees good growth prospects for Halliburton Company (HAL)

Halliburton Company (NYSE: HAL) stock fell -1.80% on Tuesday to $39.84 against a previous-day closing price of $40.57. With 11.88 million shares changed hands, the volume of the stock remained heavier than its average volume of 9.7 million shares. During the session, the Oil & Gas Equipment & Services company that operates in wider Energy sector, reached to the highest price of $41.00 whereas the lowest price it dropped to was $39.18. The 52-week range on HAL shows that it touched its highest point at $43.99 and its lowest point at $23.30 during that stretch. It currently has a 1-year price target of $47.19. With its current market cap of 35.73 billion, HAL has annualized dividend of $0.48 while the current yield stands at 1.20%. Beta for the stock currently stands at 2.16.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of HAL was down-trending over the past week, with a drop of -6.32%, but this was up by 3.13% over a month. Three-month performance surged to 17.59% while six-month performance rose 40.18%. The stock gained 44.66% in the past year, while it has gained 1.25% so far this year. A look at the trailing 12-month EPS for HAL yields 1.93 with Next year EPS estimates of 2.94. For the next quarter, that number is 0.67. This implies an EPS growth rate of 148.90% for this year and 39.63% for next year. EPS is expected to grow by 43.40% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 17.50%.

Float and Shares Shorts:

At present, 908.00 million HAL shares are outstanding with a float of 905.37 million shares on hand for trading. On Oct 13, 2022, short shares totaled 22.32 million, which was 2.46% higher than short shares on Sep 14, 2022. In addition to Mr. Jeffrey Allen Miller as the firm’s Pres, CEO & Chairman, Mr. Eric J. Carre serves as its Exec. VP & CFO.

Institutional Ownership:

Through their ownership of 84.12% of HAL’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 7.34% of HAL, in contrast to 54.48% held by mutual funds. Shares owned by individuals account for 31.38%. As the largest shareholder in HAL with 10.47% of the stake, The Vanguard Group, Inc. holds 95,089,499 shares worth 95,089,499. A second-largest stockholder of HAL, Capital Research & Management Co, holds 63,517,044 shares, controlling over 7.00% of the firm’s shares. SSgA Funds Management, Inc. is the third largest shareholder in HAL, holding 59,383,523 shares or 6.54% stake. With a 3.21% stake in HAL, the American Balanced Fund is the largest stakeholder. A total of 29,136,350 shares are owned by the mutual fund manager. The SPDR Series – Energy Select Secto, which owns about 2.87% of HAL stock, is the second-largest Mutual Fund holder. It holds 26,013,460 shares valued at 1.02 billion. American Funds Growth Fund of Ame holds 2.82% of the stake in HAL, owning 25,646,179 shares worth 1.01 billion.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for HAL since 28 analysts follow the stock currently. There are 23 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 2 believe that the stock is worth HOLDING, 3 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With HAL analysts setting a high price target of $54.00 and a low target of $40.00, the average target price over the next 12 months is $48.04. Based on these targets, HAL could surge 35.54% to reach the target high and rise by 0.4% to reach the target low. Reaching the average price target will result in a growth of 20.58% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. HAL will report FY 2022 earnings on 01/23/2024. Analysts have provided yearly estimates in a range of $2.13 being high and $1.97 being low. For HAL, this leads to a yearly average estimate of $2.10. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Halliburton Company surprised analysts by $0.04 when it reported $0.60 EPS against a consensus estimate of $0.56. The surprise factor in the prior quarter was $0.04. Based on analyst estimates, the high estimate for the next quarter is $0.70 and the low estimate is $0.63. The average estimate for the next quarter is thus $0.67.

Summary of Insider Activity:

Insiders traded HAL stock several times over the past three months with 13 Buys and 56 Sells. In these transactions, 244,941 shares were bought while 280,903 shares were sold. The number of buy transactions has increased to 28 while that of sell transactions has risen to 88 over the past year. The total number of shares bought during that period was 481,425 while 907,275 shares were sold.

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