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What Do Analysts Expect from Baker Hughes’s 4Q16 Earnings?

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Baker Hughes’s earnings

In 4Q16, analysts expect an $0.11 adjusted loss per share for Baker Hughes (BHI). Wall Street analysts expect Baker Hughes’s adjusted loss to improve 29% in the coming quarter—compared to the adjusted loss of $0.15 per share in 3Q16. Reactivation of rigs in the US and growth opportunities in Kuwait, the United Arab Emirates, India, and Oman could improve Baker Hughes’s 4Q16 earnings. However, persistent pricing pressure and project delays in some of Baker Hughes’s international operations could pressure its earnings. Baker Hughes is expected to release its 4Q16 financial results on January 26.

From 3Q15 through 3Q16, Baker Hughes’s adjusted net loss per share fell significantly. However, compared to 2Q16, its 3Q16 earnings improved.

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Earnings versus estimates

In 3Q16, Baker Hughes’s adjusted EPS (earnings per share) exceeded analysts’ consensus EPS. On average, the adjusted EPS was ~2% above the consensus EPS in the past 13 quarters, as noted in the above graph. Baker Hughes accounts for 0.17% of the iShares S&P 500 Value ETF (IVE). The energy sector makes up 12.3% of IVE.

Analysts’ estimates for Baker Hughes’s peers

Analysts expect FMC Technologies’ (FTI) 4Q16 adjusted earnings to improve to -$0.32 per share—compared to adjusted 3Q16 earnings of -$0.39. FMC Technologies’ market capitalization is ~$8.1 billion—compared to Baker Hughes’s market capitalization of $26.7 billion. Core Laboratories’ (CLB) 4Q16 adjusted earnings are expected to improve to $0.40—compared to $0.38 in 3Q16. Analysts expect Fairmount Santrol Holdings’ (FMSA) 4Q16 adjusted EPS to fall to -$0.09 in 4Q16 from -$0.07 in 3Q16. Read Wall Street Picks: The Best and Worst Oilfield Service Stocks to learn more about Wall Street analysts’ estimates for oilfield services companies.

What’s in this series?

In this series, we’ll discuss management’s guidance, value drivers, and industry indicators impacting Baker Hughes’s performance. We’ll also discuss analysts’ target prices for Baker Hughes. Next, we’ll discuss how management’s outlook transpired in past quarters.

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