Halliburton and Weatherford International Experience Higher Operating Costs in the 1st Quarter

NEW YORK, NY / ACCESSWIRE / March 28, 2017 / Halliburton and Weatherford both made announcements yesterday that will impact their first quarter financial reports to investors. They both are experiencing expansion and growth, but there is a short term price to pay that investors will have to be patient with to see how things look at the end of the year.

RDI Initiates
Coverage:

Halliburton Company https://ub.rdinvesting.com/news/?ticker=HAL

Weatherford
International Plc https://ub.rdinvesting.com/news/?ticker=WFT

Halliburton stock closed down 3.30% to settle at $47.78 on Monday. The stock traded between $48.77 and $47.52 on volume of 14,193,715 shares traded. The downturn is part of a general market reaction to the uncertainty of the economy after the collapse of the proposed health care legislation. The news that more directly impacted the stock price occurred yesterday during a scheduled conference call/webcast to update the 4th quarter company operational plan. In that call, Halliburton, the oilfield service giant, said it would be incurring the projected operational expenses for the entire year into the first 6 months of the year. The reason for this was the increase in demand for Halliburton rigs, which is currently at a pace of almost 2 per day, requires the outlay of the operational expenses. In addition to the operation costs, the company will be hiring almost 2,000 field employees in the Unites States alone as it expects 25 percent increase in revenue from US land operation in the current quarter from those reported in fourth quarter last year, but the hiring will add to the costs and will impact 1st quarter profits and giving it a miss. An unexpected contract in the Gulf of Mexico has been another event that adds to the impact the expected single digit earnings per share cost of Halliburton’s reported first quarter financial results. Despite yesterday’s news and price drop, the stock began recovering in after hours trading.

Halliburton has been reducing its debt consistently and it has announced redemption of senior notes totaling $1.4 billion in the current quarter. The company has received large numbers of “buy” ratings from different analysts, and recently Deutsche Bank reiterated “buy” ratings on the company on 27th March, and couple of “buy” or “overweight” ratings were also assigned from other investment research firms during the month of March.

Access RDI’s Halliburton Research Report at:
https://ub.rdinvesting.com/news/?ticker=HAL

Weatherford International ended the day moving up 7.98% to close at $6.36 on Monday. The stock traded between $6.51 and $6.25 on volume of 36,798,144 shares traded. Recently it announced a joint venture with Schlumberger that will result in 70% of Weatherford’s onshore resources being owned, operated, and consolidated by Schlumberger. In addition to the properties, Weatherford will get a payment in the amount of $535 million once the deal is finalized, which is expected to be completed in the fourth quarter of this year. The joint venture will be called OneStim.

Weatherford stock has had its ups and downs to start the year, closing at $5.18 on February 1st of this year.

Access RDI’s Weatherford Research Report at:
https://ub.rdinvesting.com/news/?ticker=WFT

Our Actionable Research on Halliburton Company (NYSE: HAL) and Weatherford International Plc (NYSE: WFT) can be downloaded free of charge at Research Driven Investing.

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Disclaimer: This article is written by an independent contributor of RDInvesting.com and reviewed by Hemal K. Gandhi, a CFA® charter holder. RDInvesting.com is neither a registered broker dealer nor a registered investment advisor. For more information please read our full disclaimer at www.rdinvesting.com/disclaimer.

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