After Raising Its Dividend, is Halliburton Stock a Buy?

NYSE: HAL | Halliburton Company  News, Ratings, and Charts

HAL – Oil field services company Halliburton Company (HAL) recently beat Wall Street’s earnings expectations and increased its quarterly dividend. However, is it wise to buy the stock now amid uncertainty associated with rising COVID-19 cases? Let’s find out.

The oilfield contractor Halliburton Company (HAL) is currently trading 2.4% below its 52-week high of $32.13, which it hit on January 27, 2022, after raising its quarterly dividend by 166.7% year-over-year to $0.12 per share. For the fourth quarter, its revenues and adjusted EPS beat analysts’ expectations by 19% and 5.9%, respectively.

Also, the company announced that it will partly redeem its $1 billion of senior notes due in 2025 as part of its ongoing commitment to debt reduction. The stock has gained 36.1% over the past month to close yesterday’s trading session at $31.36. However, the rising COVID-19 cases, labor and supply shortages, and rising input costs make its near-term prospects look uncertain.

Here’s what could influence HAL’s performance in the upcoming months:

Solid Financials

HAL’s revenue increased 32.1% year-over-year to $4.28 billion for the fiscal fourth quarter ended December 31, 2021. The company’s adjusted operating income grew 57.1% year-over-year to $550 million, while its adjusted net income came in at $320 million representing a 100% year-over-year increase. Also, its adjusted EPS came in at $0.36, up 100% year-over-year.

Lower-than-Industry Profitability

In terms of trailing-12-month gross profit margin, HAL’s 13.33% is 67.4% lower than the industry average of 40.86%. Likewise, its trailing-12-month CAPEX/Sales of 5.22% is 33.6% lower than the industry average of 7.86%. Moreover, the stock’s trailing-12-month EBITDA margin of 17.29% is 17.5% lower than the industry average of 20.97%.

Stretched Valuation

In terms of forward P/B, HAL’s 3.63x is 112.1% higher than the industry average of 1.71x. Likewise, its forward P/CF of 11.06x is 83.1% higher than the industry average of 6.04x. Moreover, the stock’s forward non-GAAP P/E of 17.66x is 44.6% higher than the industry average of 12.22x.

POWR Ratings Reflect Uncertainty

HAL has an overall rating of C, which equates to a Neutral in our POWR Ratings system. The POWR Ratings are calculated by taking into account 118 different factors, with each factor weighted to an optimal degree.

Our proprietary rating system also evaluates each stock based on eight different categories. HAL has a D grade for Stability, in sync with its beta of 2.76.

The stock has a C grade for Value, in sync with its higher-than-industry valuation ratios.

HAL is ranked #9 of 41 stocks in the D-rated Energy – Services industry. Click here to access HAL’s ratings for Growth, Sentiment, Quality, and Momentum as well.

Bottom Line

While HAL exhibited robust financial performance in the last reported quarter and raised its quarterly dividend, its lofty valuation and lower-than-industry profitability make the stock’s near-term prospects uncertain. So, it could be wise to wait for a better entry point in the stock.

How Does Halliburton (HAL) Stack Up Against its Peers?

While HAL has an overall POWR Rating of C, you might want to consider investing in the following Energy – Services stocks with an A (Strong Buy) or B (Buy) rating: Rex American Resources Corp. (REX), North American Construction Group Ltd. (NOA), and Subsea 7 S.A. (SUBCY).

Want More Great Investing Ideas?

3 Stocks to DOUBLE This Year


HAL shares were trading at $30.59 per share on Monday afternoon, down $0.77 (-2.46%). Year-to-date, HAL has gained 33.76%, versus a -6.07% rise in the benchmark S&P 500 index during the same period.


About the Author: Nimesh Jaiswal


Nimesh Jaiswal's fervent interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving a stock’s price is the key approach that he follows while advising investors in his articles. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
HALGet RatingGet RatingGet Rating
REXGet RatingGet RatingGet Rating
NOAGet RatingGet RatingGet Rating
SUBCYGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


What Happens After 6,000 for Stocks?

The S&P 500 (SPY) has the petal to the medal after the election and 2nd Fed rate cut. However, stocks are now pressed up against serious resistance at 6,000 which begs the question of what happens next? Investment pro Steve Reitmeister shares his timely market views including a preview of his top 10 stocks. Get the full story below...

3 Streaming Stocks Benefiting from Cord-Cutting Trends

As streaming continues to dominate the digital entertainment landscape, the global streaming market presents a lucrative investment opportunity. So, it could be ideal to invest in fundamentally solid streaming stocks Netflix (NFLX), Walt Disney (DIS), and Roku (ROKU). Read further...

3 Gold Stocks to Buy as Safe-Haven Demand Grows

Gold is a stable investment now due to its role as a safe-haven asset during economic uncertainty, rising demand, industrial use, and growth, bolstered by central bank purchases and interest rate cuts. Therefore, investors should consider investing in top gold stocks such as Newmont (NEM), Barrick Gold (GOLD), and Agnico Eagle Mines (AEM). Read more...

3 AI Stocks Transforming Industries and Driving Future Growth

With rapid digitalization, rapid adoption, and development, as well as surging demand, the AI market is on the rise. Amid this backdrop, investors could buy fundamentally solid AI stocks NVIDIA Corporation (NVDA), Microsoft (MSFT), and Meta Platforms (META) poised for substantial gains. Continue reading...

Stock Investing AFTER the Election

The S&P 500 (SPY) has been stuck under the highs awaiting the election results. The biggest mystery is how soon results will be finalized. The second biggest concern is what the Fed will do at their 11/7 meeting. Steve Reitmeister shares his views on these things along with fresh market outlook and preview of his top 10 stocks to buy now.

Read More Stories

More Halliburton Company (HAL) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All HAL News