23.60 -0.01 (-0.04%)
Pre-Market: 8:43AM EST
|Bid||23.00 x 1100|
|Ask||23.61 x 4000|
|Day's Range||23.40 - 23.84|
|52 Week Range||1.18 - 28.65|
|Beta (5Y Monthly)||0.98|
|PE Ratio (TTM)||N/A|
|Earnings Date||Jan 21, 2020|
|Forward Dividend & Yield||0.72 (3.05%)|
|Ex-Dividend Date||Nov 05, 2019|
|1y Target Est||29.21|
Had there been no waiver extensions, Chevron's (CVX) exit would follow close on the heels of various other U.S.-based players that left Venezuela.
Domestic drillers may again remove rigs since explorers have a conservative capital budget in place and have decided to curb spending on drilling new wells.
Kinder Morgan's (KMI) fourth-quarter results are expected to have been aided by Gulf Coast Express Pipeline's natural gas transportation volumes.
Oil bulls will get no help this week before the week’s end, with Baker Hughes reporting that the number of oil and gas rigs in the US increased this week
Baker Hughes on Friday reported that the number of active U.S. rigs drilling for oil rose by 14 to 673 this week. That followed declines for oil rigs in each of the past three weeks. The total active U.S. rig count, meanwhile, was up 15 from last week to 796, according to Baker Hughes. Oil prices extended their decline, with February West Texas Intermediate crude down 20 cents, or 0.3%, at $58.32 a barrel. It was trading at $58.50 before the rig data.
The three biggest oilfield service providers have all announced asset sales as they adapt to an environment featuring lower demand for their services
(Bloomberg) -- As the U.S. shale boom unfolded, the number of oil wells that were drilled but never opened for production steadily rose. Now, that figure has plunged by a surprising 10% in the newest sign yet of tough times for drillers.A weighty decline in the so-called fracklog is perhaps the most salient gauge of a developing slowdown in U.S. shale. It shows that explorers are no longer racing to drill wells faster than they can complete them.The drop adds to a growing body of evidence that shale explorers, pushed by investors to prioritize profits over production, are stepping on the brakes. That’s bad news for oilfield services companies that have depended on rising shale growth for their prosperity. When Halliburton Co., owner of the world’s biggest fleet of fracking pumps, reports on its fourth quarter on Jan. 21, analysts expect to see a 29% earnings decline from a year earlier, excluding certain items.“We continue to believe 2020 will be a tale of two markets, with North America being a muddle while the recovery should continue in international and offshore arenas,” James West, an analyst at Evercore ISI, said Jan. 10 in a note to investors titled, “4Q Earnings Season Could Be Ugly.“The number of drilled but uncompleted wells, known as DUCs, have generally increased since the end of 2016, with the rise largely attributable to factors that include lower-than-ideal pricing for oil and gas and limited pipeline capacity. But between May and November, the number fell to 7,574 from a high of 8,429, according to the most recent data from the U.S. Energy Information Administration.That’s the steepest decline over the last three years. The key now for the biggest service providers may be how quickly they can pivot toward opportunities outside of shale.Consider the case of Baker Hughes Co., which spun off its onshore fracking business three years ago. While Halliburton is expected to report a fourth-quarter decline, Baker Hughes is forecast to report adjusted earnings on Jan. 22 that are up 19% to 31 cents a share, according to analysts.When Schlumberger Ltd., which already has a major focus outside the U.S., reports Friday, it’s expected to best last year’s fourth-quarter adjusted earnings by about a penny to 37 cents a share. The world’s biggest oilfield service company has said its North American land business, which includes pressure pumping, is now under strategic review and analysts say the company could announce an update to the unit on its earnings call.“2019 was a brutal year for completions activity,” analysts at Tudor Pickering Holt & Co. wrote in a note earlier this month. “And the pressure pumpers sit in a deep hole that’ll likely take a while to dig out of absent a stout demand surprise.”To contact the reporter on this story: David Wethe in Houston at email@example.comTo contact the editors responsible for this story: Simon Casey at firstname.lastname@example.org, Reg GaleFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Baker Hughes (BKR) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
Bernstein analyst Nicholas Green argues that investors should indeed put money to work in the oil-services sector. He said some companies offer enormous opportunities to savvy investors.
Drillers added 118 rigs during the week ended Jan. 10, bringing the total count up to 203, the highest since March 2019, data from Baker Hughes Co showed on Friday. Most of the rigs added last week were in Alberta (69) and Saskatchewan (42). Drillers in Canada, like their counterparts in the United States, slashed the number of rigs operating in 2019 as energy prices dropped due to a global glut.
Domestic drillers may continue to remove rigs since explorers have a conservative capital budget in place and have decided to curb spending on the drilling of new wells.
Oil futures settled lower on Friday, with U.S. benchmark prices down more than 6% for the week, marking their largest weekly percentage decline since July, according to FactSet data. Baker Hughes reported a third weekly fall in the number of active U.S. rigs drilling for oil, but the news failed to support prices, which have now fallen for four consecutive sessions following a lack of significant developments in the U.S.-Iran conflict. February West Texas Intermediate oil declined by 52 cents, or 0.9%, to settle at $59.04 barrel on the New York Mercantile Exchange. For the week, the front-month contract fell 6.4%, marking the biggest weekly percentage decline since July.
Baker Hughes on Friday reported that the number of active U.S. rigs drilling for oil fell by 11 to 659 this week. That followed declines for oil rigs in each of the past two weeks. The total active U.S. rig count, meanwhile, was down 15 from last week at 781, according to Baker Hughes. Oil prices continued to decline, with February West Texas Intermediate crude down 29 cents, or 0.5%, at $59.27 a barrel.
Given that shale drillers will probably generate handsome free cashflows in 2020, it would be ideal to keep an eye on the following Permian explorers that are poised to gain.
As with many other stocks in 2019, General Electric (NYSE:GE) ended with a nice bullish move. Starting in early October, shares of GE stock went from $8.28 to around $12 per share. This put the year-long return for 2019 at about 53%, which exceeded the gain on the S&P 500.Source: testing / Shutterstock.com This performance, though, is more than just about general optimism in the overall markets. CEO Larry Culp has done a standout job at the helm since coming on board in October 2018.Although, this should not be a surprise. When he was the CEO of Danaher (NYSE:DHR) -- from 2000 to 2014 -- there was a five-fold jump in both the revenues and market cap.InvestorPlace - Stock Market News, Stock Advice & Trading TipsHe showed that he can effectively manage the strategic vision, as well as the nuanced details of a complex organization. He also demonstrated a great ability to apply process methodologies, like lean manufacturing -- which strives for continuous improvement. This approach was initially innovated at Toyota (NYSE:TM). * 8 of the Strangest Stocks Worth Your Time When Culp became CEO of GE, the situation was dire. The company had gone through two CEOs, the shares were delisted from the Dow, the dividend was slashed and the losses were piling up. From 2016 to 2018, the General Electric stock went from $32 to under $7.However, Culp put together a smart playbook to right the ship. Of course, a key part of this was an aggressive focus on reducing the bloated cost structure. He also was swift in unloading assets, like the biotech business and Baker Hughes (NYSE:BKR).Yet, this was mostly about the low-hanging fruit. Going forward, it will likely be more difficult to find ways to improve the organization. Many Problems RemainOne of the biggest issues for GE stock is the GE engine segment, which accounts for a hefty 60% of the industrial profits. The problem, of course, is Boeing's (NYSE:BA) 737 MAX, which has been sidelined due to two traffic airline crashes. It is still far from clear when production and deliveries will resume. But in the meantime, GE is feeling the impact, with a quarterly loss of $400 million in cash flows. This is likely to put lots of pressure on the company given the enormous debt load of $93.2 billion.Furthermore, the other company segments are also lagging. For example, even though the Power business has shown improvement, revenues were still off by 14% in the latest quarter. What's more, the Healthcare Systems unit has been mostly lackluster, with a meager 5% increase on the top line. There has continued to be weakness in China and the Middle East.Then there is GE Capital, which is suffering from the liabilities of its long-term care business. In the quarter, there was a loss of $645 million. Bottom Line on the GE Stock PriceFor the most part, Culp has stabilized operations, which is definitely crucial. Not long ago, there were serious concerns about the viability of GE; The situation had gotten that bad.But despite all this, it does look like that much of the good news has already been factored into GE stock. Consider that the forward price-to-earnings ratio is 18x, which is rich for a company that still has a host of problems. By comparison, Honeywell (NYSE:HON) trades at 20X and United Technologies (NYSE:UTX) is at 18X. No doubt, both of these companies are on much more solid footing.So, at least in the near-term, it's probably best to be cautious with GE stock.Tom Taulli is the author of the book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 8 of the Strangest Stocks Worth Your Time * 7 Stocks to Buy That Trump's Tax Cut Truly Rewarded * 5 Stocks That Could Double in 2020 The post Itas Time to Be Cautious With General Electric Stock appeared first on InvestorPlace.
Baker Hughes (NYSE: BKR) announced today that the Baker Hughes international rig count for December 2019 was 1,104, up 8 from the 1,096 counted in November 2019, and up 79 from the 1,025 counted in December 2018. The international offshore rig count for December 2019 was 257, up 10 from the 247 counted in November 2019, and up 23 from the 234 counted in December 2018.
The price of oil continued to slide, reversing gains sparked by the U.S.’s killing of a top Iranian general last week. The major U.S. stock indexes were mixed.
Domestic drillers may continue to remove rigs since explorers have a conservative capital budget in place and have decided to curb spending on drilling new wells.
The energy sector consists of stocks related to the production and supply of energy around the world. The sector includes upstream firms that are involved in the exploration and production of oil or gas reserves, such as EOG Resources Inc. (EOG). Also in the sector are downstream companies that refine and process oil and gas products for delivery to consumers, including HollyFrontier Corp. (HFC).
Traders have to be careful about chasing the markets higher because like we saw in September, the market has supply flexibility. Additionally, the U.S. is likely to ramp up shale production.
Baker Hughes on Friday reported that the number of active U.S. rigs drilling for oil fell by seven to 670 this week. That followed a decline of eight oil rigs in the previous week. The total active U.S. rig count, meanwhile, was down nine from last week at 796, according to Baker Hughes. Oil prices continued to rise on the back of heightened U.S.-Iran tensions, with February West Texas Intermediate crude up $1.48, or 2.4%, at $62.66 a barrel.
Napoleon Bonaparte once said that his army marched on its stomach – by which he meant, of course, that no amount of military genius would help him if he let his troops outrun their supply wagons. Food and water are as important as guns and ammunition to an army.By analogy, our economy marches on oil. Factories and power plants, cars and trucks, computers and smartphones – none of them run by themselves, they all need a source of energy. Which puts energy companies – and the investors who buy their stocks – in a potentially enviable position. They occupy a “necessary niche,” one that customers will always need, in good times or bad, booms or busts.International banking firm Credit Suisse has released a year-end report on their favorite energy stocks, those that the firm’s analysts believe have potential to lead their sector in growth for 2020. Hindsight being perfect, we won't know the actual results until next December – but we can analyze the companies and their market positions, and make intelligent estimates of near-term performance.This is where TipRanks, a company that tracks and measures the performance of Wall Street’s financial analysts, offers an invaluable service. In addition to tracking the analysts, TipRanks also collects and collates data on more than 6,400 publicly traded stocks. A variety of search and filter tools, from the classic Stock Screener tool are available to make it easy to use the raw data.We’ve gotten the process started for you, by pulling up the information on three of Credit Suisse’s top 2020 energy plays.Sunrun, Inc. (RUN)Sustainability is all the rage in energy, as environmentalists, activists, investors, and just plain old concerned citizens want to ensure a cleaner future. New tech has made it possible to extract fossil fuels from previously marginal reserves, and scrubbers exist to keep pollutants from the air – but drilling and burning still do environmental damage. Solar energy is one option as providers and customers consider switching, and here, too, new technology has improved the available choices. Sunrun, a company providing residential solar options, is clear example.Sunrun offers customers three choices for adding solar power generation to their homes: a lease model, in which the company installs and owns photoelectric panels, and the customer uses the power generated to reduce electricity bills; a model, in which solar panels charge batteries which are then used to reduce grid power use during peak rate hours – or replace it during an outage; and a purchase system, in which the customer buys solar power generation technology, has it installed, and enjoys the benefits.The company has leveraged demand for its products to produce quarterly profits since Q2 2019, and build up a $1.63 billion market cap. Sunrun’s Q3 earnings, reported in November, missed the forecasts but showed strong year-over-year gains. EPS was up to 23 cents, from a 2-cent loss the year before, while revenues gained 5% year-over-year to hit $215.5 million.Credit Suisse’s Michael Weinstein makes RUN stock a ‘top pick,’ writing, “We expect them to grow deployments >15%/yr... RUN continues to retain the highest market share (16.2%) with robust project profitability ($1/W NPV), cash generation ~$100M annually, and a $50M stock buyback program over the next three years.”Weinstein puts a $24 price target on RUN, suggesting an impressive upside potential of 73% for the stock. (To watch Weinstein’s track record, click here)Sunrun has a Strong Buy rating from the analyst consensus, with 4 Wall Street reviewers giving the stock a Buy rating during Q4 2019. The stock sells for just $13.81, so even the low-ball price target of $18 would represent significant gains for investors. The average price target, $22, implies a strong upside of 58%. (See Sunrun stock analysis at TipRanks)Diamondback Energy (FANG)Texas is the epicenter of the American oil boom, and Diamondback is a mid-sized player in the rich Permian Basin in the western part of the states. The company engages in oil exploration and drilling operations, and produces more than 130,000 barrels of oil equivalent per day. Diamondback, while not an industry giant, is playing an important part in the Texan fracking industry that has in recent years made the US the world’s largest oil producer.Low prices, however, can hurt even the strongest companies. The low-price regime that dominated 2019’s oil market held FANG to a mere 1% gain for the year. The Q3 numbers, reported in November, showed the result – earnings were down, both year-over-year and against the estimates, even though revenues were up. Increased production did not quite make up for the lower product prices. Put into numbers, the EPS was still strong at $1.47, and revenues reached $975 million.FANG paid out a dividend of 18.75 cents per share, for an annualized payout of 75 cents and a decidedly modest yield of 0.81%. That yield is roughly half the sector average – but it is reliable, as FANG has been maintaining or raising the dividend for the last two years, and with a payout ratio of just 12%, it is easily sustainable.Company management recently revised down their 2020 production guidance, putting it into line with 2019’s actual numbers – and the company underperformed the sector last year. Credit Suisse analyst Betty Jiang looked at management’s action and sees in it reason to believe that FANG will improve performance in the coming year. She writes, “While management has made a concerted effort (with much improved disclosure) to explain the factors that drove the downward revision, we continue to field questions on the impact of co-development on 2020 well productivity and perhaps more importantly, whether this is truly a one-time reset (our answer is “yes”)... Based on our work, we believe FANG’s revised 2020 production is achievable while they will likely continue to be successful in driving down costs.”Jiang puts a $116 price target on FANG shares, showing her confidence in a 25% growth potential. (To watch Jiang’s track record, click here)The analyst consensus on FANG is not unanimous, but almost. The Strong Buy consensus rating is supported by 15 Buys against a single Hold – Wall Street is sanguine about this stock. Shares sell for $91.67, and the average price target of $122.27 indicates an upside of 31%. (See Diamondback stock analysis at TipRanks)Baker Hughes Company (BKR)With Baker Hughes, we move power sources (solar or crude oil) to support services. BKR is an oilfield services company, offering the specialized tech and engineering knowledge and tools that the oil and gas industry needs. Baker Hughes’ services allow exploration companies to evaluate area geology, complete wells, and support drilling operations. The company offers support in the upstream, midstream, and downstream segments of the industry.Two key numbers from 2018 show both the scale and headwinds of the oil industry. Baker Hughes brought in over $22.8 billion in revenues that year – but showed a net income of just $195 million. The oil industry may have a captive audience for its products, and generate large amounts of cash, but high overhead and variable market prices cut deeply into margins.Last fall, BKR entered into a partnership with C3.ai and Microsoft, a three-way joint venture to develop ai cloud-based AI software solutions for the oil industry. The three companies are leaders in their sectors, and bring together high-end expertise in oilfield support, cloud computing, and AI software. Baker Hughes CEO Lorenzo Simonelli described the venture as “a singular offering that can accelerate digital transformation across the sector, energy businesses can now draw on the power of Microsoft’s cloud, C3.ai’s leading AI capabilities, and Baker Hughes’s expertise in the energy industry.”Just two weeks before announcing the partnership, BKR had reported strong Q3 earnings. Revenues and EPS both gained year-over-year, with the top line hitting $5.88 billion and EPS coming in at 21 cents. During the quarter BKR also improved its free cash flow, generating an FCF of $161 million.Jacob Lundberg, reviewing the stock for Credit Suisse, took a bullish stance, writing, “We met with C3.ai’s Tom Siebel at the company’s headquarters in Redwood City, CA, to learn more about C3’s technology and its partnership with BKR. We walked away from the meetings more bullish on the prospects for BKR to drive a meaningful and sustainable competitive advantage… stemming from its early adoption of and exclusive access to C3’s technology… the directional impact is clearly positive.”Lundberg put a $28 price target on BKR, backing up a Buy rating. His target suggests a 9% upside to BKR stock. (To watch Lundberg’s track record, click here)BKR is another stock with a unanimous Strong Buy consensus rating, this one backed by 9 recent Buy reviews. The $29 average price target suggests an upside premium of 14% from the $25.43 current share price. (See Baker Hughes stock analysis at TipRanks)
This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios...