Texas-Based Baker Hughes Warns Of $100-$200 Million EBITDA Risk From Tariffs In 2025
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 23 2025
0mins
Source: Benzinga
Financial Performance: Baker Hughes reported first-quarter FY25 revenue of $6.43 billion, missing expectations, while adjusted EPS rose 19% to $0.51. The company anticipates Q2 revenue between $6.3 billion and $7.0 billion amid trade policy uncertainties impacting future earnings.
Stock Movement and Outlook: Following the earnings report, Baker Hughes' stock fell by 4.37% to $36.69. The company declared a quarterly dividend and executed share buybacks, but faces potential tariff impacts of $100 million to $200 million on EBITDA for FY25.
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Analyst Views on BKR
Wall Street analysts forecast BKR stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for BKR is 55.17 USD with a low forecast of 52.00 USD and a high forecast of 61.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
12 Analyst Rating
11 Buy
1 Hold
0 Sell
Strong Buy
Current: 61.250
Low
52.00
Averages
55.17
High
61.00
Current: 61.250
Low
52.00
Averages
55.17
High
61.00
About BKR
Baker Hughes Company is an energy technology company with a portfolio of technologies and services that span the energy and industrial value chain. The Company operates in two segments: Oilfield Services & Equipment (OFSE) and Industrial & Energy Technology (IET). OFSE segment provides products and services for onshore and offshore oilfield operations across the lifecycle of a well, ranging from exploration, appraisal, and development, to production, rejuvenation, and decommissioning. OFSE is organized into four product lines: Well Construction; Completions, Intervention, and Measurements; Production Solutions, and Subsea and Surface Pressure Systems. IET segment provides technology solutions and services for mechanical-drive, compression and power-generation applications across the energy industry, including oil and gas, liquefied natural gas (LNG) operations, downstream refining and petrochemical markets, as well as lower carbon solutions to broader energy and industrial sectors.
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.
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- Significant Acquisition Context: Following its $9.6 billion acquisition of industrial equipment maker Chart Industries last year, Baker Hughes is conducting a comprehensive evaluation of its capital allocation to ensure effective integration and business growth post-acquisition.
- New Order Secured: Recently, Baker Hughes received a gas turbine order from Twenty20 Energy to supply 10 Frame 5 gas turbines and associated equipment for U.S. data center infrastructure, further solidifying its market position in critical infrastructure.
- Positive Stock Reaction: Baker Hughes shares rose 4% on Wednesday, reflecting market optimism regarding its potential asset sale and new orders, although retail sentiment remains bearish; nonetheless, the company's stock has increased nearly 30% over the past year.
See More
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- Major Order Announcement: Baker Hughes (BKR) has secured a significant order from Twenty20 Energy for 10 Frame 5 gas turbines and associated generator technology, supporting up to 250 MW of power generation capacity, indicating strong demand in the power equipment market.
- Delivery Schedule: Initial deliveries are designated for Twenty20 Energy's data center projects in Georgia and Texas, scheduled for completion in 2027, which will help meet the increasing demand for digital infrastructure.
- Strategic Partnership Outlook: This order signifies progress in the strategic agreement between Baker Hughes and Twenty20 Energy, as both companies commit to supplying multi-gigawatt power generation equipment to address the rapidly growing demand for reliable and sustainable power in the U.S.
- Positive Market Reaction: Baker Hughes (BKR) shares rose 3.8% in Wednesday's trading, reaching a nine-year high of $62.08, reflecting investor optimism regarding the company's future growth potential.
See More
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- Urgent Investment Needs: The Syrian government is seeking billions of dollars in foreign investment to repair its severely damaged energy facilities due to 14 years of war, highlighting the urgent need for reconstruction in the energy sector.
- Kurdish Forces Integration: The eastern region of Syria, traditionally rich in oil and previously controlled by Kurdish forces, has agreed to integrate into state governance, creating new opportunities for foreign investment and enhancing the stability of energy development.
- Accelerated International Cooperation: Last week, Chevron signed an initial offshore gas exploration agreement in Syria with a Qatari firm, indicating a rising interest from international energy companies in the Syrian market, potentially paving the way for future investments.
See More
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- Capital Expenditure Shift: Major companies like Exxon and Chevron are shifting their capital programs towards complex, high-return projects that require more engineering, equipment, and services, providing robust support for SLB and Baker Hughes.
- Tech Sector Lagging: While investors are skeptical about the rapid growth of AI revenues in the tech sector, the energy sector's sustained performance suggests a preference for tangible scarcity over digital hype, reflecting a broader investor inclination towards physical assets.
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- Market Value: The total market value of the shares being sold is approximately $3.22 million.
See More
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- Increased Trading Activity: The rise in SPY has led to heightened trading activity, indicating a renewed interest from investors in the stock market, potentially boosting overall market liquidity.
- Enhanced Investor Confidence: The ETF's upward movement may bolster investor confidence, prompting more capital to flow into the stock market, which could positively impact the performance of related assets.
- Market Trend Monitoring: The performance of SPY may signal broader market trends, and investors should monitor upcoming economic data and policy changes in the coming weeks to assess the potential for sustained market strength.
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