Halliburton's stock declines amid market weakness and earnings call announcement
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 18 2024
0mins
Should l Buy HAL?
Halliburton Co's stock price fell by 5.02% during regular trading, crossing below the 20-day SMA, reflecting a challenging market environment. This decline occurs amid broader market weakness, with the Nasdaq-100 down 0.31% and the S&P 500 down 0.47%. The upcoming earnings call scheduled for January 21, 2026, has heightened investor focus on the company's performance, but the current market conditions suggest sector rotation may be influencing the stock's movement.
The stock's decline is attributed to sector rotation, as investors are reacting to the overall market sentiment, which is currently negative. Despite the scheduled earnings call, which typically generates interest, the prevailing market conditions have overshadowed this event, leading to a decrease in stock value. Investors are likely weighing the potential implications of the earnings report against the backdrop of a weakening market.
This situation highlights the importance of market conditions in influencing stock performance. While Halliburton's upcoming earnings call could provide insights into the company's financial health, the current market dynamics suggest that investors are cautious, leading to a decline in stock price.
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Analyst Views on HAL
Wall Street analysts forecast HAL stock price to fall
18 Analyst Rating
12 Buy
6 Hold
0 Sell
Moderate Buy
Current: 33.710
Low
28.00
Averages
32.31
High
39.00
Current: 33.710
Low
28.00
Averages
32.31
High
39.00
About HAL
Halliburton Company is a provider of products and services to the energy industry. The Company operates through two segments: Completion and Production and the Drilling and Evaluation. The Completion and Production segment delivers cementing, stimulation, specialty chemicals, intervention, pressure control, artificial lift, and completion products and services. The segment consists of artificial lift, cementing, completion tools, pipeline and process services, production enhancement, and production solutions. The Drilling and Evaluation segment provides field and reservoir modeling, drilling fluids, evaluation and precise wellbore placement solutions that enable customers to model, measure, drill, and optimize their well construction activities. Its product service lines include Baroid, drill bits and services, Halliburton project management, landmark software and services, Sperry drilling, testing and subsea and wireline and perforating.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Halliburton Shares Surge 55% Following Q3 Earnings Beat
- Stock Recovery: Halliburton's shares have surged 55% since beating Q3 earnings estimates in October, successfully reversing summer lows and demonstrating market confidence in management's cost control initiatives.
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- Strong International Market: Despite a 7% sequential decline in North American sales due to reduced shale activity, international revenue rose 7% sequentially, with the Europe/Africa region seeing a 12% increase in revenue from higher tool sales, reflecting a global demand rebound.
- Share Buyback Strategy: Halliburton repurchased 42 million shares last year at an average price of $23.80, continuing its strategy to reduce total share count, and plans to maintain this buyback pace in 2026, further enhancing shareholder value.
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- Capital Flow Changes: Goldman Sachs equity strategist Ben Snider indicates that capital is rotating towards sectors perceived as insulated from AI disruption, marking a clear departure from last year's market strategies and reflecting diminished investor confidence in AI themes.
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- Stock Recovery: Halliburton's shares have surged 55% since beating Q3 earnings estimates in October, successfully reversing summer lows and demonstrating market confidence in management's cost control initiatives.
- Profitability Improvement: Although Q4 revenue grew only 1% year-over-year, adjusted operating margins rebounded from 13% in Q2 to 15%, indicating a recovery in profitability driven by increased revenue from international contracts.
- Strong International Market: Despite a 7% sequential decline in North American sales due to reduced shale activity, international revenue rose 7% sequentially, with the Europe/Africa region seeing a 12% increase in revenue from higher tool sales, reflecting a global demand rebound.
- Share Buyback Strategy: Halliburton repurchased 42 million shares last year at an average price of $23.80, continuing its strategy to reduce total share count, and plans to maintain this buyback pace in 2026, further enhancing shareholder value.
See More
Financial Sector Underperforms with Notable Losses
- Financial Companies Underperform: As of midday Tuesday, financial companies are down 0.6%, with Standard and Poor's Global Inc (SPGI) and Raymond James Financial Inc (RJF) showing losses of 9.1% and 8.7%, respectively, indicating significant weakness in the sector that may affect investor confidence.
- ETF Performance Analysis: The Financial Select Sector SPDR ETF (XLF), which tracks the financial sector, is down 1.4% on the day and 2.85% year-to-date, reflecting the overall malaise in the financial market and potentially leading to capital outflows from the sector.
- Energy Sector Stability: In contrast to the financial sector, the energy sector is only down 0.5%, with Halliburton Company (HAL) up 19.83% year-to-date, demonstrating resilience in the energy industry that may attract investors to shift focus.
- Impact of Holdings Proportions: SPGI and RJF together account for approximately 2.0% of XLF's underlying holdings, while HAL and EQT make up 3.9% of XLE's underlying holdings, indicating that the performance of these companies directly influences the overall performance of their respective ETFs.
See More
Capital Group Identifies Attractive Dividend Stock Opportunities
- Dividend Stock Appeal: Christopher Buchbinder from Capital Group highlights the attractiveness of dividend stocks, particularly those rated investment grade with a long history of income payments, which has allowed the CGDV fund to outperform the S&P 500 in down markets.
- Tech Sector Allocation: As of January 31, 26.8% of CGDV's assets are allocated to information technology, particularly semiconductor companies, reflecting the team's confidence in a sustainable AI investment cycle, with expectations that AI will dramatically change lives over the next 5-10 years.
- Energy Sector Opportunities: Although energy comprises only 6.4% of CGDV's portfolio, Buchbinder sees an upcycle in the oil field services sector over the next few years, particularly with Halliburton's collaboration with VoltaGrid to manufacture power systems for AI data centers, indicating long-term growth potential.
- Healthcare Investment: CGDV's largest healthcare holding is Eli Lilly at 3.86%, with Buchbinder believing that the long-term trend of GLP-1 drugs will transform the healthcare landscape in the U.S., positioning Eli Lilly as the market leader while awaiting FDA approval for its oral GLP-1 drug.
See More
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- Kyndryl Stock Plunge: Kyndryl Holdings' shares tumbled 55% following the disclosure of an audit committee review of cash management practices, which not only undermines investor confidence but may also pose greater challenges for future financing and operations.
- Executive Departures Impact: The immediate departure of CFO David Wyshner and General Counsel Edward Sebold indicates potential internal management issues, which could exacerbate market concerns regarding the company's governance structure.
- Cleveland-Cliffs Poor Performance: Cleveland-Cliffs reported a wider-than-expected adjusted EBITDA loss of $21 million, primarily due to weakness in the auto and Canadian markets; although the company anticipates improvements by 2026, it still faces short-term market challenges.
- Valaris Acquisition News: Valaris shares surged 28% after agreeing to be acquired by Transocean for $5.8 billion, with Valaris shareholders set to receive 15.235 shares of Transocean stock for each Valaris share held, reflecting strong demand in the offshore drilling services market.
See More
U.S. Stock Futures Rise, Focus on Aecom and ON Semiconductor
- Aecom Earnings Forecast: Aecom (NYSE:ACM) is projected to report quarterly earnings of $1.17 per share on revenue of $3.61 billion, indicating stable growth in the infrastructure sector that may enhance investor confidence.
- Stock Performance: Aecom shares rose 2.4% to close at $101.03 on Friday, reflecting optimistic market sentiment ahead of its earnings report, which could attract more investor attention.
- ON Semiconductor Earnings Outlook: Analysts expect ON Semiconductor Corp. (NASDAQ:ON) to post quarterly earnings of 62 cents per share with revenue of $1.54 billion, suggesting ongoing demand and growth potential in the semiconductor market.
- Stock Movement: ON Semiconductor shares gained 0.1% in after-hours trading, closing at $65.23, indicating market anticipation for its earnings report, which may influence future investment decisions.
See More
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- Market Sentiment Shift: As fears grow that artificial intelligence could disrupt demand rather than enhance it, software and AI-exposed stocks have faced significant sell-offs at the start of 2023, particularly in February, leading investors to reassess their risk exposure.
- Capital Flow Changes: Goldman Sachs equity strategist Ben Snider indicates that capital is rotating towards sectors perceived as insulated from AI disruption, marking a clear departure from last year's market strategies and reflecting diminished investor confidence in AI themes.
- Cyclical Industry Rally: Despite software stocks experiencing one of their worst weeks since the 2022 rate-hike panic, cyclical and consumer-linked industries have continued their recent rallies, indicating a growing preference for traditional sectors among investors.
- Strong Dow Jones Performance: Amid the decline in software stocks, the Dow Jones Industrial Average has rallied towards all-time highs, suggesting increased investor confidence in industries tied to physical assets and cyclical activity, further emphasizing the market's demand for safety from AI-driven productivity risks.
See More
