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Halliburton (HAL) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Halliburton (HAL) closed at $16.18 in the latest trading session, marking a -0.55% move from the prior day. This change lagged the S&P 500's daily loss of 0.22%. At the same time, the Dow lost 0.78%, and the tech-heavy Nasdaq gained 0.68%.

Prior to today's trading, shares of the provider of drilling services to oil and gas operators had gained 10.91% over the past month. This has outpaced the Oils-Energy sector's gain of 1.13% and the S&P 500's gain of 9.15% in that time.

Investors will be hoping for strength from HAL as it approaches its next earnings release, which is expected to be October 19, 2020. The company is expected to report EPS of $0.08, down 76.47% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.11 billion, down 44% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.54 per share and revenue of $14.45 billion, which would represent changes of -56.45% and -35.53%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for HAL. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. HAL currently has a Zacks Rank of #2 (Buy).

In terms of valuation, HAL is currently trading at a Forward P/E ratio of 30.03. This represents a no noticeable deviation compared to its industry's average Forward P/E of 30.03.

Investors should also note that HAL has a PEG ratio of 4.6 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Oil and Gas - Field Services was holding an average PEG ratio of 4.86 at yesterday's closing price.

The Oil and Gas - Field Services industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 74, which puts it in the top 30% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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