BRAZIL – 2020/03/28: In this photo illustration the Halliburton Company logo is displayed on a … [+] smartphone. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images)
SOPA Images/LightRocket via Getty Images
The shares of Halliburton (NYSE: HAL) have reached pre-Covid levels in recent weeks assisted by higher benchmark prices and recovering demand. Along with a 35% contraction in the top line, the company’s net property, plant and equipment declined by 41% last year – reporting $3.8 billion of impairment and other charges.
Despite a quick jump in benchmark prices, U.S. rig count numbers remain 43% below pre-Covid levels. Moreover, the EIA expects a slow improvement in rig count figures as benchmark prices are likely to observe a correction next year. Given the company’s ongoing capital preservation measures including capex cut and trimmed dividend (leading to lower dividend yield), Trefis believes that HAL stock is overvalued. We highlight the historical trends in revenues and earnings along with the full-year...read more...