Banking

Three Oil Giants Near Buy Points Gear Up For Earnings

Oilfield service providers Halliburton (HAL), Schlumberger (SLB) and Baker Hughes (BRK) will report quarterly results this week amid a surge in crude oil prices.




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Oil prices have soared over the last month, with U.S. crude hitting $80 per barrel for the first time since 2014. Despite an uptick in demand for oil amid rising Covid-19 vaccinations and declining cases, OPEC+ kept its production increases steady, which added to a looming energy crunch this winter in the U.K. and China.

But analysts don’t expect a big increase in new drilling in the U.S. amid the jump in oil prices as U.S. producers continue to focus on capital discipline.

“Even with higher oil prices, I don’t think we’re going to see another sort of running to the fields and drilling fast,” Chris Midgley, global director of analytics at S&P Global Platts, told reporters during a recent roundtable.

Instead, the focus of larger U.S. producers will be on making sure currently operating wells have increased productivity. Much of the rig count growth will come from smaller players. That could impact oilfield service providers’ Q3 and Q4 results.

Oilfield Service Providers: Halliburton Earnings

Estimates: FactSet analysts see third-quarter Halliburton earnings rising 154% to 28 cents per share. Revenue is seen rising 31% to $3.9 billion.

Results: Check back Tuesday morning.

Stock: Shares closed flat at 26.01 on the stock market today. Halliburton stock is currently in buy range after breaking out of a cup base with a 25.10 entry point, according to MarketSmith analysis. But after running up, especially over the past month, HAL stock could be due for a pullback. Plus, investors need to be cautious when buying a stock ahead of earnings.

Baker Hughes Earnings

Estimates: Zacks analysts see Baker Hughes earnings per share soaring 450% to 22 cents, with revenue up 6% to $5.35 billion.

Results: Check back Wednesday morning.

Stock: Shares inched up 0.3% to 26.96, just out of range. Baker Hughes stock finally cleared a 25.58 buy point from a cup-with-handle base on Oct. 12. The 5% buy zone runs up to 26.86.

Schlumberger Earnings

Estimates: FactSet sees Schlumberger earnings jumping 125% to 36 cents a share, with revenue up 13% to $5.9 billion.

Results: Check back before the market opens Friday. Schlumberger typically gives an update on oil industry trends at large as well as an update on what is expected for the sector in the coming quarters.

Stock: Shares rose 0.5% to 34.16. Schlumberger stock is forming a cup base with a 36.97 buy point.

Follow Gillian Rich on Twitter for energy news and more.

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