why Halliburton (NYSE: HAL) may climb to $51 ?

52 week low

52 week high

$37.21

$74.33

Market cap

$37.45B

Average volume

21.04M

P/E ratio

10.70

Rev. per Employee

$426,883

EPS

4.13

Dividend

0.18

Div yield

1.63%

Ex dividend date

3/2/15

• Halliburton (NYSE:HAL) saw a fairly good year last year. However, the turmoil in the industry indicates that keeping up the performance this year as well might be an uphill task.
• Despite the possibility of a slow 2015, the company's long term growth prospects are fundamentally intact making it one of the best buys in an industry that seems to have a slow year ahead of itself.
• Halliburton recently announced the trimming of its workforce by up to 8%, which amounts to 6,400 layoffs, in light of the prevailing oil price volatility in the market.
• Halliburton seems to be in pursuit in cost savings at the moment, at a time when the IEA has indicated that crude oil prices could average out to $55 per barrel this year.
• Halliburton ended last year with operating income of $5 billion against revenues of $33 billion. Its fourth quarter was a relatively good one as the company was able to outperform analyst estimates by 8.2%, posting its quarterly earnings at $1.19 per share.
• Halliburton has maintained its dividend payout tradition, after announcing a 20% increase in its quarterly dividend to $0.18 per share. The company has paid out continuous since 1972
• The company's first quarter earnings estimates have been revised downwards from $1.09 to $0.69. Additionally, the company's full year earnings outlook has also been downgraded from $4.82 to $2.15.
• Recent developments in Halliburton about a cut in the work force, we could see margins stabilize during the later part of the year, with continuation into the next few years as well.
• Halliburton acquisition of Baker Hughes likely to materialize sometime in the second half of the year, we could begin to witness the pressure on the company's bottom lines ease out, as the company expects to incur $2 billion in cost savings as a result of the deal.
• Revenues could remain on the lighter side and margins could contract as oil companies lower capital expenditure and wish to sign new contracts at lower rates with rig counts declining.
• Halliburton recently announced the trimming of its workforce by up to 8%, which amounts to 6,400 layoffs, in light of the prevailing oil price volatility in the market.
• The company’s first quarter earnings estimates have been revised downwards from $1.09 to $0.69. Additionally, the company’s full year earnings outlook has also been downgraded from $4.82 to $2.15.
• The first couple of quarters will be rough on the company’s revenues and margins, as the activity of the industry witnesses a slow down and as rig counts decline rapidly.
• We could witness further retreat in stock prices, especially during the initial earnings announcements of the current year. Those dips would be an ideal time to invest in the stock.
• We expect price of Halliburton Climb up to $ 51 in second quarter