Bidness ETC - Halliburton Company surpassed 1QFY15 earnings estimate

Halliburton reported first quarter results for fiscal year 2015 and posted earnings of 49 cents per share and $823 million in revenues.

Halliburton Company is disturbed by the declining prices of crude oil, as the oil company reported $643 million loss, or $0.76 earnings per share, for the quarter covering from January to March of fiscal year 2015. During the similar quarter last year, the company reported $622 million in profits equals to $0.73 EPS.

Exclusive of particular items like write down amount of $823 million and job reductions and the exchange rate charge of Venezuelan currency, Halliburton posted earnings of $0.49 per share and surpassed the consensus forecast of $0.36 earnings per share.

The company announced in February that it is most likely to reduce its international workforce by almost 8% or 6,400 of its staff.

Halliburton revenue decreased by 4% on Y-o-Y basis to $7.05 billion, surpassing the $6.96 billion consensus estimate

Last year, Halliburton declared acquiring its rival Baker Hughes in a deal worth of $34.6 billion. The merger raised questions as the regulators believes that the acquisition would mean that the joined company will become large and might exploit the market. The Houston-based oil company has specified to sell its 3 business units in order to get approval by regulatory bodies. The merger with Baker Hughes is most likely to bring $2 billion of cost saving.

Furthermore, with crude oil prices declining by more than 50% in the last nine months, Halliburton mentioned that its drilling service demand has declined considerably. According to a report by WSJ, Dave Lesar CEO of the company related to issue said, “Industry prospects will continue to be challenged in the coming quarters, and visibility to the ultimate depth and length of this cycle remains uncertain.”

Bloomberg reported, Cowen Group forecast that if oil prices stood at $60 per barrel, also then the production and exploration customers of the company would reduce expenditure by 35%.

Almost 36 analysts covered Halliburton stock, out of which 26 assigned a rating of Buy and 8 suggested a rating of hold to the stock of the company. The twelve-month consensus price target estimate is $49.21. Jefferies analyst Brad Handler gave buy rating to the stock with 12-month price target projected at $54.

Halliburton stock was up by 2.05% to $47.85 at market close on Monday and increased further during after hour trading session by 0.31% to $48.