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Baker Hughes Company (BKR)
NASDAQ:BKR

Baker Hughes Company (BKR) AI Stock Analysis

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BK

Baker Hughes Company

(NASDAQ:BKR)

Rating:74Outperform
Price Target:―
Baker Hughes receives a solid overall score driven by its strong financial performance and positive corporate events. While technical indicators show mixed signals and valuation is moderate, the company's resilience and strategic positioning in key growth areas provide a stable outlook amidst macroeconomic challenges.
Positive Factors
Earnings and Financial Performance
The IET segment's EBITDA exceeded the high-end guidance, contributing positively to overall results.
Growth Opportunities
Baker Hughes' outsized gas/LNG exposure is seen as a major growth opportunity, supporting the analyst's rating of the stock as a top play.
Portfolio Attributes
The company's unique portfolio attributes are placing incremental value on its stock despite the largely negative oil macro updates.
Negative Factors
Segment Performance
Baker Hughes expects international and North American activity in the OFSE segment to decline in the coming year.
Stock Performance
The stock underperformed the OIH by approximately 450 basis points.
Tariff Impacts
BKR sees a net EBITDA impact in the range of $100-$200MM due to tariff impacts, with more than 50% of the impacts related to the IET segment.

Baker Hughes Company (BKR) vs. SPDR S&P 500 ETF (SPY)

Baker Hughes Company Business Overview & Revenue Model

Company DescriptionBaker Hughes Company provides a portfolio of technologies and services to energy and industrial value chain worldwide. It operates through four segments: Oilfield Services (OFS), Oilfield Equipment (OFE), Turbomachinery & Process Solutions (TPS), and Digital Solutions (DS). The OFS segment offers exploration, drilling, wireline, evaluation, completion, production, and intervention services; and drilling and completions fluids, wireline services, downhole completion tools and systems, wellbore intervention tools and services, pressure pumping systems, oilfield and industrial chemicals, and artificial lift technologies for oil and natural gas, and oilfield service companies. The OFE segment provides subsea and surface wellheads, pressure control and production systems and services, flexible pipe systems for offshore and onshore applications, and life-of-field solutions, including well intervention and decommissioning solutions; and services related to onshore and offshore drilling and production operations. The TPS segment provides equipment and related services for mechanical-drive, compression, and power-generation applications across the oil and gas industry. Its product portfolio includes drivers, compressors, and turnkey solutions; and pumps, valves, and compressed natural gas and small-scale liquefied natural gas solutions. This segment serves upstream, midstream, downstream, onshore, offshore, and industrial customers. The DS segment provides sensor-based process measurements, machine health and condition monitoring, asset strategy and management, control systems, as well as non-destructive testing and inspection, and pipeline integrity solutions. The company was formerly known as Baker Hughes, a GE company and changed its name to Baker Hughes Company in October 2019. Baker Hughes Company is based in Houston, Texas.
How the Company Makes MoneyBaker Hughes makes money primarily through the sale of oilfield products, services, and digital solutions to the energy sector. The company's revenue streams are diversified across its four business segments. Oilfield Services generate income by providing drilling, evaluation, completion, and production services to oil and gas operators. Oilfield Equipment earns revenue through the sale and maintenance of critical equipment used in the exploration and extraction of oil and gas. Turbomachinery & Process Solutions segment generates income by supplying and servicing turbomachinery used in the energy and industrial markets. Lastly, the Digital Solutions segment provides software, sensors, and analytics to optimize performance and efficiency across various industries. Significant partnerships with major energy companies, along with a focus on innovation and sustainability, contribute to the company's earnings.

Baker Hughes Company Earnings Call Summary

Earnings Call Date:Apr 22, 2025
(Q1-2025)
|
% Change Since: 2.39%|
Next Earnings Date:Jul 16, 2025
Earnings Call Sentiment Neutral
The call highlighted strong first quarter performance and significant achievements in Industrial & Energy Technology, LNG, and data centers. However, challenges in oil markets, tariff uncertainties, and reduced upstream spending offset these positives, leading to a cautious outlook.
Q1-2025 Updates
Positive Updates
Strong First Quarter Results
Baker Hughes delivered strong results, meeting or exceeding the midpoint of their EBITDA guidance for the ninth consecutive quarter. They set new first quarter records for revenue and adjusted measures of EPS, EBITDA, and EBITDA margin.
Industrial & Energy Technology (IET) Performance
IET experienced a solid start to the year, booking $3.2 billion of orders with segment backlog reaching a record level of $30.4 billion. Adjusted EBITDA increased by 10% year-over-year, with a significant 30% increase in IET EBITDA.
LNG and Data Center Momentum
Baker Hughes secured $1.7 billion of LNG orders over the past two quarters. They also entered the data center market, booking orders for over 350 megawatts of power.
Resilient Balance Sheet
The company ended the first quarter with cash of $3.3 billion, a net debt-to-EBITDA ratio of 0.6x, and liquidity of $6.3 billion.
Continued Margin Improvement
OFSE EBITDA margin rate improved to 17.8%, showing an 80 basis point improvement year-over-year despite revenue declining by 8%.
Negative Updates
Challenges in Oil Markets
Downward pressure observed due to OPEC+ returning 2.2 million barrels per day to the market, causing increased volatility and affecting global GDP and oil demand.
Tariff and Trade Policy Uncertainty
Potential tariff impacts estimated to have a net EBITDA impact in the range of $100 million to $200 million, with ongoing uncertainty in trade negotiations.
Weakness in OFSE Revenue
OFSE revenue declined by 10% sequentially due to enhanced seasonal weakness and delayed discretionary spending, particularly in international markets.
Reduced Upstream Spending
Global upstream spending is expected to decline by high-single digits in 2025, with a mid- to high-single-digit decline internationally and a low-double-digit decrease in North America.
Company Guidance
During the first quarter of 2025 earnings call, Baker Hughes provided guidance influenced by a complex macroeconomic landscape, including geopolitical tensions, trade policy uncertainties, and oil price volatility. The company projected a high-single digit decline in global upstream spending for 2025, with international markets expecting a mid- to high-single digit decline and North America facing a low-double digit reduction. Despite these challenges, Baker Hughes maintained confidence in its Industrial & Energy Technology (IET) segment, reaffirming its full-year EBITDA guidance range of $2.2 billion to $2.4 billion, supported by a robust equipment backlog and recurring revenues. The Oilfield Services & Equipment (OFSE) segment faced more variability due to reduced upstream spending and tariff-related cost inflation. Overall, the company estimated a net EBITDA impact from tariffs between $100 million and $200 million, contingent upon current tariff levels remaining through the year. Baker Hughes emphasized its focus on driving productivity, executing with discipline, and achieving structural margin improvements, targeting a 16.1% adjusted EBITDA margin, up 140 basis points from the previous year.

Baker Hughes Company Financial Statement Overview

Summary
Baker Hughes demonstrates strong financial health with robust profitability and efficient operations. The income statement reveals solid revenue and profit growth, while the balance sheet reflects a stable financial structure with moderate leverage. However, recent declines in free cash flow growth suggest potential areas for improvement.
Income Statement
88
Very Positive
Baker Hughes has demonstrated robust growth and profitability. The TTM gross profit margin stands at 21.94%, and the net profit margin is an impressive 10.51%, indicating efficient cost management. Revenue growth has been strong, with a 9.14% increase from 2023 to 2024. The EBIT margin is 11.47%, and EBITDA margin is 16.42%, reflecting solid operational efficiency.
Balance Sheet
80
Positive
The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.31, showing moderate leverage. The return on equity is 14.97%, indicating good profitability relative to equity. The equity ratio stands at 51.29%, suggesting a strong equity base compared to assets.
Cash Flow
75
Positive
Cash flow performance is solid, with a free cash flow to net income ratio of 0.79, indicating good cash generation relative to profit. Operating cash flow to net income ratio is 1.11, reflecting effective cash conversion. However, free cash flow growth has been negative recently, impacting the overall cash flow score.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
27.84B27.83B25.51B21.16B20.54B20.70B
Gross Profit
6.11B5.91B5.25B4.40B4.05B3.20B
EBIT
3.19B3.08B2.65B1.19B996.00M1.83B
EBITDA
4.72B4.60B3.96B1.33B1.83B-13.62B
Net Income Common Stockholders
2.93B2.98B1.94B-578.00M-330.00M-15.76B
Balance SheetCash, Cash Equivalents and Short-Term Investments
3.28B3.36B2.65B2.49B3.85B4.13B
Total Assets
38.11B38.36B36.95B34.18B35.35B38.03B
Total Debt
6.02B6.02B6.02B6.66B6.73B7.63B
Net Debt
2.75B2.66B3.38B4.17B2.87B3.50B
Total Liabilities
20.90B21.31B21.43B19.66B18.60B19.79B
Stockholders Equity
17.04B16.89B15.37B14.53B16.75B18.24B
Cash FlowFree Cash Flow
2.01B2.05B1.84B1.12B1.83B517.00M
Operating Cash Flow
3.26B3.33B3.06B1.89B2.37B1.30B
Investing Cash Flow
-1.06B-1.02B-817.00M-1.56B-463.00M-618.00M
Financing Cash Flow
-1.60B-1.53B-2.03B-1.59B-2.14B225.00M

Baker Hughes Company Technical Analysis

Technical Analysis Sentiment
Positive
Last Price39.03
Price Trends
50DMA
37.43
Positive
100DMA
40.92
Negative
200DMA
39.82
Negative
Market Momentum
MACD
0.24
Negative
RSI
61.76
Neutral
STOCH
89.26
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BKR, the sentiment is Positive. The current price of 39.03 is above the 20-day moving average (MA) of 37.53, above the 50-day MA of 37.43, and below the 200-day MA of 39.82, indicating a neutral trend. The MACD of 0.24 indicates Negative momentum. The RSI at 61.76 is Neutral, neither overbought nor oversold. The STOCH value of 89.26 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BKR.

Baker Hughes Company Peers Comparison

Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
FTFTI
82
Outperform
$13.82B17.4027.24%0.61%14.26%294.37%
TSTS
80
Outperform
$19.55B11.0210.45%6.20%-15.28%-45.42%
HAHAL
77
Outperform
$18.70B9.1120.99%3.13%-2.54%-17.53%
SLSLB
76
Outperform
$48.31B12.0520.82%3.21%5.83%-2.03%
BKBKR
74
Outperform
$38.72B13.3518.04%2.35%6.22%62.58%
NONOV
73
Outperform
$5.00B8.889.29%6.31%0.54%-39.88%
58
Neutral
$7.37B3.39-4.49%10.01%0.82%-49.15%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
BKR
Baker Hughes Company
39.03
7.52
23.87%
FTI
TechnipFMC
34.27
9.52
38.46%
HAL
Halliburton
22.19
-11.47
-34.08%
NOV
NOV
13.37
-4.04
-23.21%
SLB
Schlumberger
35.69
-7.78
-17.90%
TS
Tenaris SA
36.24
5.86
19.29%

Baker Hughes Company Corporate Events

Executive/Board ChangesShareholder Meetings
Baker Hughes Approves Board and Executive Compensation
Neutral
May 22, 2025

On May 20, 2025, Baker Hughes Company held its Annual Meeting of Stockholders to elect nine members to its Board of Directors, approve the executive compensation program, and ratify KPMG LLP as its independent registered public accounting firm for fiscal year 2025. All nominated directors were elected, the executive compensation program was approved, and KPMG LLP was ratified, with a significant majority of the votes cast in favor of each proposal.

The most recent analyst rating on (BKR) stock is a Buy with a $43.00 price target. To see the full list of analyst forecasts on Baker Hughes Company stock, see the BKR Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Baker Hughes Reports Strong Q1 2025 Financial Results
Positive
Apr 22, 2025

On April 22, 2025, Baker Hughes reported its first-quarter 2025 results, highlighting orders of $6.5 billion and revenue of $6.4 billion. The company achieved a net income of $402 million and adjusted EBITDA of $1,037 million, marking a 10% increase year-over-year. Baker Hughes expanded its leadership in LNG with new awards and strategic agreements, and made significant progress in power solutions for data centers. Despite macroeconomic uncertainties, the company remains confident in its strategy, focusing on structural margin improvement and sustainable growth.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.