Halliburton Stock Story

HAL
 Stock
  

USD 29.34  0.23  0.78%   

Halliburton is scheduled to announce its earnings tomorrow. The stock is undervalued compared to its sector. Halliburton Enterprise Value is relatively stable at the moment as compared to the past year. The company's current Enterprise Value is estimated at 30.73 Billion. Invested Capital is expected to hike to about 22.7 B this year, although the value of Earnings Before Interest Taxes and Depreciation Amortization EBITDA will most likely fall to nearly 2.5 B. While some of us are becoming more enthusiastic about energy space, let's summarize Halliburton in greater detail to make a better estimate of its debt utilization.
Published over three weeks ago
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Will Halliburton (NYSE:HAL) be in financial trouble before August?

The company has 9.58 B in debt with debt to equity (D/E) ratio of 1.36, which is OK given its current industry classification. Halliburton has a current ratio of 2.15, demonstrating that it is liquid and is capable to disburse its financial commitments when the payables are due. Debt can assist Halliburton until it has trouble settling it off, either with new capital or with free cash flow. So, Halliburton's shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Halliburton sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Halliburton to invest in growth at high rates of return. When we think about Halliburton's use of debt, we should always consider it together with cash and equity.
Halliburton financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures the total debt position of Halliburton, including all of Halliburton's outstanding debt obligations, and compares it with the equity. In simple terms, the high financial leverage means the cost of production, together with running the business day-to-day, is high, whereas, lower financial leverage implies lower fixed cost investment in the business and generally considered by investors to be a good sign. So if creditors own a majority of Halliburton assets, the company is considered highly leveraged. Understanding the composition and structure of overall Halliburton debt and outstanding corporate bonds gives a good idea of how risky the capital structure of a business is and if it is worth investing in it.
Please read more on our technical analysis page.

Understanding Halliburton Total Liabilities

Halliburton liabilities are broken down into two parts on the balance sheet. These are short-term (or current) obligations and long-term debt. Halliburton has to fulfill its short-term liabilities in this reporting year and should be no more than 12 months old. Long-term debt, on the other hand, is anything beyond the 12-month payment timeframe. Common short-term liabilities found on Halliburton balance sheet include debt obligations and money owed to different Halliburton vendors, workers, and loan providers. Below is the chart of Halliburton short long-term liabilities accounts currently reported on its balance sheet.
You can use Halliburton financial leverage analysis tool to get a better grip on understanding its financial position

How important is Halliburton's Liquidity

Halliburton financial leverage refers to using borrowed capital as a funding source to finance Halliburton ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Halliburton financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Halliburton's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Halliburton, but it might be worth checking our own buy vs. sell analysis

Breaking down Halliburton Indicators

The big decline in price over the last few months for Halliburtonmay raise some interest from stakeholders. The stock closed today at a share price of 29.02 on 3,329,482 in trading volume. The company executives failed to add value to investors and position the firm supply of money to exploit market volatility in June. However, diversifying your holdings with Halliburton or similar stocks can still protect your portfolios during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 3.59. The above-average risk is mostly attributed to market volatility and speculations regarding some of the upcoming earning calls from Halliburton partners.

Asset Breakdown

12.6 B
Assets Non Current
2.9 B
Goodwill
Tax Assets
10.5 B
Current Assets
Total Assets23.07 Billion
Current Assets10.49 Billion
Assets Non Current12.58 Billion
Goodwill2.93 Billion
Tax Assets2.22 Billion

Over 3 percent hike for Halliburton. What does it mean for stakeholders?

Mean deviation is down to 2.85. It may denote a possible volatility pull down. Halliburton exhibits very low volatility with skewness of -0.58 and kurtosis of 0.03. However, we advise investors to further study Halliburton technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Halliburton's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Halliburton's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Halliburton Implied Volatility

Halliburton's implied volatility exposes the market's sentiment of Halliburton stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Halliburton's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Halliburton stock will not fluctuate a lot when Halliburton's options are near their expiration.

While other companies in the oil & gas equipment & services industry are either recovering or due for a correction, Halliburton may not be performing as strong as the other in terms of long-term growth potentials. With a relatively neutral outlook on the new economy, it is better to hold off any trading of Halliburton as the current risk-reward utility is not appealing enough. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Halliburton.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of Halliburton. Please refer to our Terms of Use for any information regarding our disclosure principles.

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