Baker Hughes (BKR) moved after fresh rig count data and a brief jump in oil prices tied to tensions between Israel and Iran, sharpening investor focus on how higher drilling activity feeds into oilfield services demand.

Over the past year, Baker Hughes has seen strong momentum, with the share price up 33.94% year to date and a 1 year total shareholder return of 64.52%. This reflects rising rig activity, geopolitical risk repricing and recent conference and deal headlines.

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With Baker Hughes up 33.9% year to date and trading about 12.8% below the average analyst price target despite concerns about overvaluation and insider selling, is there still a potential opportunity for investors, or is future growth already fully reflected in the current share price?

Most Popular Narrative: 11.7% Undervalued

With Baker Hughes last closing at $63.14 versus a narrative fair value of $71.52, the current pricing sits below what this widely followed model implies.

The company's strong momentum in securing large-scale service contracts, framework agreements, and technology-driven orders (such as for data centers, LNG, CCS, and recurring gas tech services) is driving an all-time high IET backlog, building strong visibility into future revenue and supporting sustained earnings durability.

Want to see what is behind that backlog driven story? The narrative leans heavily on steady revenue build, margin shaping and a richer earnings multiple. The specific mix of growth, profitability and discount rate assumptions might surprise you.

Result: Fair Value of $71.52 (UNDERVALUED)

However, the story can change quickly if cost inflation, tariffs or supply constraints squeeze margins, or if weaker upstream spending limits the impact of that growing backlog.

Next Steps

If the backlog story and valuation gap sound compelling, do not wait for someone else to make the call. Pressure test the assumptions yourself and then review the 4 key rewards

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.