On Monday, Piper Sandler adjusted its price target for Halliburton (NYSE:NYSE:HAL) shares, a major player in the energy sector, revising it downward to $40.00 from the previous target of $46.00. The firm has kept its Overweight rating on the stock.
The adjustment came after Halliburton's performance dipped by 5.6%, contrasting with a lesser 0.75% decline in the OIH, an oil services ETF. This revision follows the tempered expectations for Halliburton's 2024 outlook in both the international and North American markets. The new forecast anticipates international growth of about 10% this year, a slight decrease from the previous guidance of low double-digit growth.
Meanwhile, the North American market is now expected to contract by 6% to 8% year-over-year, compared to the previous forecast which ranged from flat to potentially increasing.
Piper Sandler's analysis suggests that the updated 2024 North American outlook for Halliburton is realistic. Despite this, the firm predicts a more subdued performance in North America for 2025. There is also a concern among investors that international growth may slow down further in 2025.
While it's still too early to predict international growth for 2025 with certainty, the uncertainty may cause Halliburton's stock to move in tandem with the general market until more clarity emerges.
The firm also revised its EBITDA estimates for Halliburton, lowering them to $5.1 billion for 2024 and $5.3 billion for 2025, down from previous estimates of $5.4 billion and $6 billion, respectively. This revision reflects the updated expectations for the company's performance in the coming years.
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