Halliburton Company HAL is set to release first-quarter results on April 22. The Zacks Consensus Estimate for the to-be-reported quarter is pegged at a profit of 60 cents per share on revenues of $5.3 billion.

Let’s delve into the factors that might have influenced the oilfield service firm’s performance in the March quarter. But it’s worth taking a look at HAL’s previous-quarter performance first.

Highlights of Q4 Earnings & Surprise History

In the last reported quarter, this Houston, TX-based provider of technical products and services to drillers of oil and gas wells, met the consensus mark. The numbers reflect softer activity in the North American region, partly offset by improved fluid work in the Gulf of Mexico. Halliburton reported adjusted net income per share of 70 cents, in line with the Zacks Consensus Estimate of 75 cents. However, revenues of $5.6 billion missed the Zacks Consensus Estimate by $31 million.

HAL beat the Zacks Consensus Estimate once in the last four quarters, met in two and missed in the other. This is depicted in the graph below:
 

Factors to Consider

After bouncing back strongly from the depths of the pandemic, the oil and natural gas rig count in the United States has gradually declined over the past year. Consequently, drilling activity — an important factor for services companies — has hit a speed bump. In the United States, a region on which Halliburton is highly dependent, the rig count has decreased by around 6% from a year ago. The steady decline in rig count is worrying for contracting activity

Consequently, our expectation for first-quarter revenues for the North American region is pegged at $2.4 billion, indicating a 4.6% decline from the year-ago quarter due to declining frac spread counts and muted demand. This is likely to have undermined the company’s earnings and cash flows.

Halliburton's operating margins, particularly in its Completion and Production segment, are expected to have contracted too. Going by our model, the company’s first-quarter segment margin is likely to come at 17.8%, down from 20.4% in the year-ago period due to slowing North American activity.

But giving some respite to the company, its pivot to digitalization and integrated services is gaining traction. Platforms like DecisionSpace 365 and its turnkey project management model offer customers end-to-end solutions, boosting efficiency and reducing coordination costs. Halliburton acts as a single service provider instead of just a contractor, which not only deepens client relationships but also ensures more stable and recurring revenues.

What Does Our Model Say?

The proven Zacks model does not conclusively show that Halliburton is likely to beat estimates in the first quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, for this company is -0.03%.

Zacks Rank: HAL currently carries a Zacks Rank #3 (Hold).

(See the Zacks Earnings Calendar to stay ahead of market-making news.)

Stocks to Consider

While an earnings beat looks uncertain for Halliburton, here are some firms from the energy space that you may want to consider on the basis of our model:

Antero Resources (AR) has an Earnings ESP of +6.19% and a Zacks Rank #2. The firm is scheduled to release earnings on April 30.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Notably, the Zacks Consensus Estimate for Antero Resources’ 2025 earnings per share indicates aARn astounding 1,604.8% year-over-year growth. Valued at around $10.3 billion, Antero Resources has gained 17.5% in a year.

Comstock Resources CRK has an Earnings ESP of +22.33% and a Zacks Rank #3. The firm is scheduled to release earnings on April 30.

Notably, the Zacks Consensus Estimate for Comstock Resources’ 2025 earnings per share indicates 404.2% year-over-year growth. Valued at around $5.7 billion, Comstock Resources has surged 114.5% in a year.

TechnipFMC plc FTI has an Earnings ESP of +0.14% and a Zacks Rank #3. The firm is scheduled to release earnings on April 24.

TechnipFMC’s expected EPS growth rate for three to five years is currently 13.6%, which compares favorably with the industry's growth rate of 7.4%. Valued at around $10.6 billion, TechnipFMC has lost 1.4% in a year.

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Halliburton Company (HAL) : Free Stock Analysis Report

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