CFRA KEEPS BUY OPINION ON SHARES OF HALLIBURTON COMPANY
4:35 am ET July 20, 2023 (CFRA)

Our 12-mo. target of $42, up $2, reflects an 8.7x multiple of EV to projected '24 EBITDA, in line with HAL's historical average. We cut our '23 EPS estimate by $0.04 to $3.02 and '24's by $0.13 to $3.56. Q2 EPS of $0.77 vs. $0.49, beat consensus by $0.02. Revenue ($5.8B) was up 14% Y/Y and 2% sequentially, driven by HAL's int'l exposure (+7%).

HAL noted that it anticipates overall market activity in NA to fall slightly in the 2H '23, given the continued decline in the U.S. rig count (down 12% YTD) due to the volatility of energy prices in the 1H '23 (WTI fell as low as $66/b in Q1 before recovering to $75/b in mid-July). While NA activity accounts for ~45% of HAL's total revenues, HAL has guided to flat to low-single-digit growth for the 2H '23; however, we think long-term, HAL is poised to benefit from strong int'l activity supported by long-term contracts and weakening U.S. drilled but uncompleted well count (down 44% since Q1 '20) which should drive up demand for HAL's services, assuming energy prices hold.