uploads///EPS adjusted vs Estimates

Halliburton’s Expected 2Q15 Earnings Signal More Weakness

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Dec. 4 2020, Updated 10:53 a.m. ET

Halliburton’s quarterly earnings per share

We discussed Halliburton (HAL) revenues versus analyst estimates in the previous part of this series. In this article, we’ll review its adjusted EPS (earnings per share) versus the estimates.

In 2Q15, analysts expect Halliburton to report $0.31 in adjusted EPS. The expected 2Q15 earnings are 37% lower than 1Q15 adjusted EPS. Weaker crude oil prices and reduced spending by North American upstream energy producers will continue to take its toll on oilfield service companies like Halliburton this quarter.

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Halliburton posted strong earnings growth up until 4Q14. But, driven by the crude oil price collapse, its 1Q15 adjusted EPS crashed by ~59% over 4Q14. Year-over-year, 1Q15 adjusted EPS fell by 33%. Adjusted earnings were mostly on the rise between 1Q13 and 4Q14. Between 1Q13 and 4Q14, the firm’s adjusted EPS increased by 78%.

In comparison, Oil States International’s (OII) 1Q15 adjusted EPS declined by 16.7% over 1Q14. FMC Technologies’ (FTI) adjusted EPS, on the other hand, witnessed a 10.5% improvement during this period.

Together, HAL, OIS, and FTI are 17.9% of the VanEck Vectors Oil Services ETF (OIH). HAL is also 2.2% of the iShares U.S. Energy ETF (IYE).

Halliburton’s earnings versus estimates

In 1Q15, adjusted EPS exceeded analysts’ consensus EPS by 37%. In 1Q15, the company recorded $823 million—after taxes—in impairment charges, including asset write-offs, inventory write-downs, impairments of intangible assets, severance costs, and other charges. Taking into account various one-time items, net earnings swung to a loss of $0.76 per share from earnings of $1.06 per share in 4Q14.

As noted in the graph above, Halliburton’s adjusted EPS exceeded estimates in many past quarters. On average, adjusted EPS exceeded consensus EPS by ~7% in the past nine quarters.

Next, we’ll discuss Halliburton’s revenue growth in its various territories.

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