Halliburton Stock Up 14% Over Last Ten Days. What’s Next?

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HAL: Halliburton logo
HAL
Halliburton

Halliburton stock (NYSE: HAL), an energy company organized into exploration, development, and production of oil and natural gas, has increased by 14% over the last ten trading days (two weeks) and currently stands at around $39. The International Energy Agency (IEA) increased its global oil demand growth estimate for 2022 and the next year, 2023, on rising crude consumption in India, China, and the Middle East. IEA now expects oil demand to grow by 1.7 million barrels per day in 2023, up from its previous estimate of 1.6 million. This comes after China is scrapping its Covid-19 quarantine rule for inbound travelers, which is seen as a major step in reopening its borders. Halliburton is generating substantial revenue growth in 2022 so far and should benefit from strong pricing in the U.S. and the need to expand production overseas.

In the third quarter, Halliburton’s revenue rose 39% year-over-year (y-o-y) to $5.4 billion. The company’s net income surged to $544 million, or $0.60 per share from $109 million, or $0.26 per share, in the year-earlier period. In terms of revenue, HAL has an almost balanced revenue distribution with 49% coming from North America and 51% coming from overseas. To break down the revenues by geography, North American business grew more than 63% y-o-y to 2.6 billion, Middle East/Asia rose by 31% y-o-y to 1.2 billion, and Latin America grew by 35% y-o-y to $841 million. The Europe/Africa/CIS business was down 5% to $639 million in Q3. Additionally, the company is involved throughout the entire E&P life cycle, with 41% of revenue coming from drilling and evaluation, and 59% from production and completion.

A strong recovery in the North American region has left the supply chain struggling to meet the demand for things like sand needed for hydraulic fracturing. As a result of these capacity constraints, HAL has been able to increase prices in order to maintain margins. Also, Halliburton is expected to benefit from the Inflation Reduction Act, which forces the Biden Administration to sell leases for drilling in the Gulf of Mexico. While this production will take several years to ramp up, it still has the potential to aid the company’s medium-term growth.

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Now, is HAL stock poised to decline in the short term or are gains looking more likely? Based on our machine learning analysis of trends in the stock price over the last ten years, there is a 53% chance of a rise in HAL stock over the next month (twenty-one trading days). See our analysis of HAL’s Stock Chance Of Rise for more details.

Calculation of ‘Event Probability’ and ‘Chance of rising’ using the last ten years data

[1] Returns of 8.9% or higher over five-day period on 143 occasions out of 2517 (6%); Stock rose in the next five days in 79 of these 143 instances (55%)

[2] Returns of 14% or higher over ten-day period on 133 occasions out of 2517 (5%); Stock rose in the next ten days in 97 of these 133 instances (73%)

[3] Returns of 8% or higher over twenty-one-day period on 655 occasions out of 2517 (26%); Stock rose in the next twenty-one days in 347 of these 655 instances (53%)

It is helpful to see how its peers stack up. HAL Peers shows how Halliburton stock compares against peers on metrics that matter. You will find other useful comparisons for companies across industries at Peer Comparisons.

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

 Returns Dec 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
 HAL Return 4% 72% -27%
 S&P 500 Return -6% -20% 71%
 Trefis Multi-Strategy Portfolio -7% -23% 210%

[1] Month-to-date and year-to-date as of 12/27/2022
[2] Cumulative total returns since the end of 2016

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