Evaluating Baker Hughes Against Peers In Energy Equipment & Services Industry

BAKER HUGHES COMPANY -1.08% Post

BAKER HUGHES COMPANY

BKR

32.10

32.10

-1.08%

0.00% Post

In today's rapidly changing and fiercely competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies. In this article, we will conduct a comprehensive industry comparison, evaluating Baker Hughes (NASDAQ:BKR) against its key competitors in the Energy Equipment & Services industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within the industry.

Baker Hughes Background

Baker Hughes is a global leader in oilfield services and oilfield equipment, with particularly strong presences in the artificial lift, specialty chemicals, and completions markets. It maintains modest exposure to offshore oil and gas production. The other half of its business focuses on industrial power generation, process solutions, and industrial asset management, with high exposure to the liquid natural gas market specifically, as well as broader industrials end markets.

Company P/E P/B P/S ROE EBITDA (in billions) Gross Profit (in billions) Revenue Growth
Baker Hughes Co 20.66 2.28 1.42 3.41% $1.08 $1.34 23.69%
Schlumberger Ltd 18.41 3.91 2.39 5.91% $2.1 $1.72 11.14%
Halliburton Co 12.60 3.59 1.45 8.03% $1.26 $1.12 8.34%
Tenaris SA 5.86 1.28 1.39 3.37% $0.98 $1.26 8.84%
NOV Inc 16.48 1.48 0.99 2.08% $0.26 $0.47 15.67%
Weatherford International PLC 21.11 9.79 1.48 17.74% $0.3 $0.45 17.23%
ChampionX Corp 20.08 3.43 1.61 4.5% $0.19 $0.29 -8.01%
Tidewater Inc 54.10 3.88 4.37 2.72% $0.1 $0.08 56.06%
Liberty Energy Inc 5.42 1.75 0.68 8.58% $0.31 $0.26 2.33%
Archrock Inc 29.72 2.85 2.56 3.54% $0.11 $0.1 18.58%
USA Compression Partners LP 159.13 10.35 2.93 3.52% $0.13 $0.08 20.86%
Oceaneering International Inc 29.76 3.97 0.99 5.36% $0.09 $0.11 13.49%
Helix Energy Solutions Group Inc 81.15 1.14 1.30 1.01% $0.07 $0.08 45.17%
RPC Inc 6.72 1.62 0.93 1.82% $0.05 $0.06 -28.11%
Kodiak Gas Services Inc 51.78 1.34 1.96 3.19% $0.12 $0.13 26.47%
ProFrac Holding Corp 12.16 1.09 0.30 -1.94% $0.13 $0.09 -17.58%
Atlas Energy Solutions Inc 21.09 13.49 1.69 57.86% $0.09 $0.09 23.2%
ProPetro Holding Corp 8.29 0.92 0.60 3.41% $0.1 $0.08 27.26%
US Silica Holdings Inc 6.02 1.08 0.55 3.35% $0.1 $0.13 -12.38%
Bristow Group Inc 51.40 1.04 0.70 0.54% $0.06 $0.23 10.03%
Dril-Quip Inc 2383 0.94 2.09 -0.8% $0.01 $0.03 33.02%
Select Water Solutions Inc 14.77 1.05 0.57 1.91% $0.05 $0.06 3.79%
Tetra Technologies Inc 22.24 4.27 0.98 3.86% $0.02 $0.04 12.19%
Newpark Resources Inc 25.85 1.43 0.77 1.85% $0.02 $0.04 -9.71%
Average 132.92 3.29 1.45 6.15% $0.29 $0.3 12.08%

Through a detailed examination of Baker Hughes, we can deduce the following trends:

  • The stock's Price to Earnings ratio of 20.66 is lower than the industry average by 0.16x, suggesting potential value in the eyes of market participants.

  • With a Price to Book ratio of 2.28, significantly falling below the industry average by 0.69x, it suggests undervaluation and the possibility of untapped growth prospects.

  • The Price to Sales ratio is 1.42, which is 0.98x the industry average. This suggests a possible undervaluation based on sales performance.

  • With a Return on Equity (ROE) of 3.41% that is 2.74% below the industry average, it appears that the company exhibits potential inefficiency in utilizing equity to generate profits.

  • The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.08 Billion, which is 3.72x above the industry average, indicating stronger profitability and robust cash flow generation.

  • Compared to its industry, the company has higher gross profit of $1.34 Billion, which indicates 4.47x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • The company's revenue growth of 23.69% exceeds the industry average of 12.08%, indicating strong sales performance and market outperformance.

Debt To Equity Ratio

debt to equity

The debt-to-equity (D/E) ratio indicates the proportion of debt and equity used by a company to finance its assets and operations.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

By analyzing Baker Hughes in relation to its top 4 peers based on the Debt-to-Equity ratio, the following insights can be derived:

  • Baker Hughes has a stronger financial position compared to its top 4 peers, as evidenced by its lower debt-to-equity ratio of 0.44.

  • This suggests that the company has a more favorable balance between debt and equity, which can be perceived as a positive indicator by investors.

Key Takeaways

Baker Hughes has a low PE ratio, indicating that its stock price is relatively low compared to its earnings. The low PB ratio suggests that the company's stock is undervalued based on its book value. The low PS ratio indicates that the stock is trading at a lower price relative to its sales. On the other hand, Baker Hughes has a high ROE, indicating that it is generating strong returns on its shareholders' equity. The high EBITDA and gross profit suggest that the company is generating significant earnings and has a strong financial position. Additionally, the high revenue growth indicates that Baker Hughes is experiencing strong sales growth compared to its peers in the Energy Equipment & Services industry.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

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