Critical Analysis: Halliburton (HAL) vs. Its Rivals

Halliburton (NYSE:HAL) is one of 42 public companies in the “OIL – FIELD SVCS” industry, but how does it compare to its rivals? We will compare Halliburton to related businesses based on the strength of its risk, profitability, earnings, institutional ownership, analyst recommendations, dividends and valuation.

Profitability

This table compares Halliburton and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Halliburton	6.95%	19.04%	7.96%
Halliburton Competitors	4.39%	4.06%	2.31%

Insider & Institutional Ownership

85.2% of Halliburton shares are owned by institutional investors. Comparatively, 57.8% of shares of all “OIL – FIELD SVCS” companies are owned by institutional investors. 0.6% of Halliburton shares are owned by company insiders. Comparatively, 8.1% of shares of all “OIL – FIELD SVCS” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Halliburton and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Halliburton	1	6	17	0	2.67
Halliburton Competitors	330	1998	3232	125	2.55

Halliburton currently has a consensus target price of $40.73, indicating a potential upside of 1.18%. As a group, “OIL – FIELD SVCS” companies have a potential downside of 6.32%. Given Halliburton’s stronger consensus rating and higher probable upside, research analysts plainly believe Halliburton is more favorable than its rivals.

Valuation and Earnings

This table compares Halliburton and its rivals gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Halliburton	$22.18 billion	$1.28 billion	22.12
Halliburton Competitors	$4.80 billion	$355.30 million	104.36

Halliburton has higher revenue and earnings than its rivals. Halliburton is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Dividends

Halliburton pays an annual dividend of $0.68 per share and has a dividend yield of 1.7%. Halliburton pays out 37.4% of its earnings in the form of a dividend. As a group, “OIL – FIELD SVCS” companies pay a dividend yield of 1.9% and pay out 44.7% of their earnings in the form of a dividend. Halliburton has increased its dividend for 4 consecutive years.

Risk & Volatility

Halliburton has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, Halliburton’s rivals have a beta of 2.96, indicating that their average stock price is 196% more volatile than the S&P 500.

Summary

Halliburton beats its rivals on 10 of the 15 factors compared.

About Halliburton

Halliburton Company provides products and services to the energy industry worldwide. It operates through two segments, Completion and Production, and Drilling and Evaluation. The Completion and Production segment offers production enhancement services that include stimulation and sand control services; cementing services, such as well bonding and casing, and casing equipment; and completion tools that offer downhole solutions and services, including well completion products and services, intelligent well completions, and service tools, as well as liner hanger, sand control, and multilateral systems. This segment also provides electrical submersible pumps, as well as artificial lift services; production solutions comprising coiled tubing, hydraulic workover units, downhole tools, and pumping and nitrogen services; pipeline and process services, such as pre-commissioning, commissioning, maintenance, and decommissioning; and specialty chemicals and services. The Drilling and Evaluation segment offers drilling fluid systems, performance additives, completion fluids, solids control, specialized testing equipment, and waste management services; drilling systems and services; wireline and perforating services consists of open-hole logging, and cased-hole and slickline; and drill bits and services comprising roller cone rock bits, fixed cutter bits, hole enlargement, and related downhole tools and services, as well as coring equipment and services. This segment also provides cloud based digital services and artificial intelligence solutions on an open architecture for subsurface insights, integrated well construction, and reservoir and production management; testing and subsea services, such as acquisition and analysis of reservoir information and optimization solutions; and project management and integrated asset management services. Halliburton Company was founded in 1919 and is based in Houston, Texas.