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Reuters
22-07-2025
- Business
- Reuters
Halliburton forecasts steep full-year revenue decline on softer demand
July 22 (Reuters) - Oilfield services company Halliburton (HAL.N), opens new tab forecast a sharp decline in full-year revenue on Tuesday after posting a 33% fall in profit for the second quarter due to softer-than-expected demand. Houston-based Halliburton joined larger rival SLB (SLB.N), opens new tab in warning of lower activity by oil and gas producers as weak and volatile oil prices have led producers to curb capital spending and drilling. Oil prices have decreased by about 8% over the last year. "To put it plainly, what I see tells me the oilfield services market will be softer than I previously expected over the short to medium term," CEO Jeff Miller said on an earnings call. North American producers are planning meaningful scheduled gaps in drilling and completions activity in the second half of 2025, while international customers continue to reduce activity and lower discretionary spending, reflecting much lower commodity prices, Miller added. Shares of the company were down 0.7% at $21.03. They are down nearly 23% year-to-date. "We had previously believed the worst was over for oilfield services, but HAL's cautious commentary gives us pause," said Stewart Glickman, energy equity analyst at CFRA Research. The company said President Donald Trump's tariffs cut profit by $27 million in the second quarter and expects a $35-million, or four cents per share, hit in the third quarter. North America revenue tumbled 9% to $2.26 billion in the quarter, while international revenue eased 3% to $3.25 billion. Full-year North America revenue will decline by the low-double digits year-over-year due to lower drilling and completions activity, Halliburton said. "Customers are fairly cautious in conserving their budgets, Miller said, citing reorganizations and cost-reduction efforts by large producers and major oil companies." International revenue in 2025 is expected to contract by mid-single digits, year-over-year, primarily due to less activity in Saudi Arabia and Mexico, the company said. It had previously forecast international revenue to be flat to slightly down. Rival SLB also flagged weaker drilling activity in Saudi Arabia and Latin America last week. Halliburton said it will retire, idle, or reallocate underperforming assets such as equipment and fleets to cut costs. The company's quarterly revenue fell 5.5% to $5.51 billion from a year earlier, but was higher than Wall Street estimates of $5.41 billion, according to data compiled by LSEG. The company reported profit of $472 million for the quarter ended June 30, down from $709 million a year earlier. On a per-share basis, Halliburton posted in-line earnings of 55 cents.
Yahoo
21-07-2025
- Automotive
- Yahoo
1 Industrials Stock with Solid Fundamentals and 2 Facing Challenges
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. But they are at the whim of volatile macroeconomic factors that sway capital spending, like interest rates. Wariness surrounding these influences has caused the industry to underperform the market as it was flat over the past six months while the S&P 500 climbed by 4.1%. The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. Taking that into account, here is one resilient industrials stock at the top of our wish list and two we're passing on. Two IndustrialsStocks to Sell: Hudson Technologies (HDSN) Market Cap: $357.4 million Founded in 1991, Hudson Technologies (NASDAQ:HDSN) specializes in refrigerant services and solutions, providing refrigerant sales, reclamation, and recycling. Why Does HDSN Fall Short? Annual sales declines of 15.5% for the past two years show its products and services struggled to connect with the market during this cycle Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term Shrinking returns on capital suggest that increasing competition is eating into the company's profitability Hudson Technologies's stock price of $8.22 implies a valuation ratio of 10.7x forward EV-to-EBITDA. To fully understand why you should be careful with HDSN, check out our full research report (it's free). MRC Global (MRC) Market Cap: $1.21 billion Producing bomb casings and tracks for vehicles during WWII, MRC (NYSE:MRC) offers pipes, valves, and fitting products for various industries. Why Are We Out on MRC? Customers postponed purchases of its products and services this cycle as its revenue declined by 2.9% annually over the last five years Earnings per share have contracted by 33.4% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance ROIC of 0.9% reflects management's challenges in identifying attractive investment opportunities At $14.05 per share, MRC Global trades at 11.9x forward P/E. If you're considering MRC for your portfolio, see our FREE research report to learn more. One Industrials Stock to Watch: Wabtec (WAB) Market Cap: $36.26 billion Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE:WAB) provides equipment, systems, and related software for the railway industry. Why Does WAB Stand Out? Core business is healthy and doesn't need acquisitions to boost sales as its organic revenue growth averaged 9.5% over the past two years Operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage Share repurchases over the last two years enabled its annual earnings per share growth of 25.5% to outpace its revenue gains Wabtec is trading at $211.91 per share, or 24.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it's free. High-Quality Stocks for All Market Conditions Donald Trump's April 2024 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities. The smart money is already positioning for the next leg up. Don't miss out on the recovery - check out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CBC
16-07-2025
- Business
- CBC
Oil industry continues focus on returning cash to investors over new big projects
While Alberta's oilpatch continues to make billions of dollars in profits, much of that money is finding its way into shareholder's pockets rather than toward major expansions of their operations. At the time of the last boom, oil producers poured a large portion of their earnings back into capital spending. In 2014, for example, oil and gas investment in Canada ranged around $80 billion. Today, it's closer to $30 billion, according to the latest numbers from the ARC Energy Research Institute, which models the entire Western Canadian Sedimentary Basin. It means that in recent years, a flood of cash hasn't sparked a surge of new projects in the province. Suncor's Fort Hills mine, the last major oilsands facility, opened in 2018. "The real change in behaviour was really more around before 2020, where companies were putting a lot more of their cash flow into [capital expenditures] and growth," said Jackie Forrest, executive director of ARC. "After the 2020 period, it really shifted to today. Only about half of the cash flow is going toward [capital expenditures] and growth. The other half is going to shareholders. "The governments are also a very significant stakeholder that is receiving almost as much as the shareholders. Of course, that benefits all Canadians through royalties and taxes." The graph above shows after-tax cash flow, which is the money oil companies have left after covering their costs, including to governments. They use it to pay down debt, invest in projects, buy other assets, or give money back to shareholders through dividends and stock buybacks, said Richard Masson, an executive fellow at the University of Calgary's School of Public Policy and the former CEO of the Alberta Petroleum Marketing Commission. Masson noted companies are reinvesting about half of their after-tax cash flow, which is a higher ratio than during the early pandemic years. But most of that money goes toward maintaining current production, not expanding it, he said. "There's only small amounts of that that are actually growth capital," he said. "It's not bad," he added, "but we haven't been able to really grow the industry because we haven't been assured of market access and good prices." What's at play? Charles St-Arnaud, chief economist at Alberta Central, the central banking facility for the province's credit unions, said available data for non-Canadian oil producers show similar patterns. "They're also reinvesting less of their revenues into their operation," he said. St-Arnaud said there are many international factors at play here, one of them being forecasts such as from the International Energy Agency, which show oil demand plateauing somewhere in the 2030s and then gradually coming down. "Does it make sense globally to invest massively in expanding oil production in this context?" he said. Masson, meanwhile, said future investment depends on a number of factors. "It depends entirely on the resource, and on market access, and on access to capital, and on skill of the workforce," he said. "Canada is one of the more competitive places in the world for investment, and we have a lot of running room left. "Even in a world that sees peak oil in the mid-2030s, because even then, almost all the actual forecasts, which are different than scenarios, most forecasts see a very shallow decline out past 2050." At the same time, global investor expectations have shifted, Masson said. "That grew out of the Permian [Basin] in Texas, where it was growing so rapidly, so much investment was happening, that shareholders kept adding more funds to the industry, but they weren't getting any returns," he said. "Eventually, they got fed up with that and said, we need to see more cash coming back. And that trend spread from New York across Canada as well, where Canadian companies had to compete by returning cash to shareholders." Masson said industry leaders also continue to cite regulatory uncertainty, including when it comes to legislation like Bill C-69, also known as the Impact Assessment Act, and the proposed emissions cap, as barriers that are holding back new investment. Steady, but not busy In Fort McMurray, Alta., the heart of Alberta's oilsands, the volatile nature of the province's boom-and-bust oil industry has been witnessed first-hand over decades. These days, it seems things are neither boom nor bust. For Owen Erskine, owner of Mitchell's Cafe in downtown Fort McMurray, the past few years have been steady, but not busy. "I don't think we've seen as much of a personnel boom as in years past … we're seeing more oil at some points, but I think they're kind of at a bit of a bottleneck where it comes to investment and that sort of thing," Erskine said. "We're not seeing a crazy huge [rush of] out-of-town people coming into the city right now." Erskine, who has lived in Fort McMurray going on 36 years, said the community is well-acquainted with the nature of the industry. "What we're seeing now is, like, since the last couple of busts, we don't have such an intense boom," he said. "The busts have become a little bit less jaw-dropping, especially as a small business like we are." The 'mature' phase Oil has been a boon for the province, but it also means that Alberta is heavily dependent on an income stream that will face challenges as the energy transition continues, according to St-Arnaud. "[The government has] been very proactive at ensuring that those revenues are still there and protecting those revenues, because it's a big source of funding for the government," he said. "If it's not there, there will be a very tough choice. And a very hard conversation is, do we keep the level of services or increase tax?" In St-Arnaud's view, the industry may have reached a "mature phase" where companies are focused on optimizing existing operations rather than expanding production. "As much as I was saying that the mid-2000s to the mid-2010s was the startup phase, well, we're in a mature phase where we're producing," he said. "Those companies are making a very good return on those investments, and they don't see the need to expand dramatically." Masson, meanwhile, said the recent Trans Mountain pipeline expansion has helped, but is already nearing full capacity. Building new infrastructure, especially pipelines to the West Coast, could take up to a decade, making long-term planning difficult. "It'll probably carry on in that range, $30 to $40 billion, for the future, until we know what we have for market access and we see some of the federal policies that the CEOs are talking about get changed," he said. The year ahead could also test how oil companies prioritize their money if prices drop, Forrest said. "If we do get prices in the below $60 [US] or in the $60 [US] range, I think you're going to start to understand what the priority is," she said.
Yahoo
30-06-2025
- Business
- Yahoo
1 Industrials Stock to Own for Decades and 2 to Avoid
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. But they are at the whim of volatile macroeconomic factors that influence capital spending (like interest rates), and the industry has underperformed the market over the past six months as its 2.6% return lagged the S&P 500 by 1.9 percentage points. The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. On that note, here is one resilient industrials stock at the top of our wish list and two that may face trouble. Market Cap: $4.77 billion Created through the acquisition and merger of various RV manufacturers, THOR Industries manufactures and sells a range of recreational vehicles, including motorhomes and travel trailers, catering to consumers seeking the freedom and comfort of the RV lifestyle. Why Should You Sell THO? Sales tumbled by 11.4% annually over the last two years, showing market trends are working against its favor during this cycle Earnings per share have contracted by 36.7% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance Shrinking returns on capital suggest that increasing competition is eating into the company's profitability THOR Industries is trading at $89.69 per share, or 18.4x forward P/E. To fully understand why you should be careful with THO, check out our full research report (it's free). Market Cap: $2.90 billion Established in 2009 in California, Tri Pointe Homes (NYSE:TPH) is a United States homebuilder recognized for its innovative and sustainable approach to creating premium, life-enhancing homes. Why Are We Out on TPH? Sales pipeline suggests its future revenue growth won't meet our standards as its backlog averaged 6.9% declines over the past two years Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 8.8 percentage points Tri Pointe Homes's stock price of $31.96 implies a valuation ratio of 10.3x forward P/E. Read our free research report to see why you should think twice about including TPH in your portfolio, it's free. Market Cap: $1.36 billion With around a century of experience, Blue Bird (NASDAQ:BLBD) is a manufacturer of school buses and complementary parts. Why Is BLBD a Good Business? Annual revenue growth of 16.5% over the past two years was outstanding, reflecting market share gains this cycle Additional sales over the last two years increased its profitability as the 156% annual growth in its earnings per share outpaced its revenue Rising returns on capital show management is finding more attractive investment opportunities At $43.12 per share, Blue Bird trades at 10.1x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
30-06-2025
- Business
- Yahoo
2 Industrials Stocks to Keep an Eye On and 1 to Keep Off Your Radar
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. But they are at the whim of volatile macroeconomic factors that influence capital spending (like interest rates), and the industry has underperformed the market over the past six months as its 2.6% return lagged the S&P 500 by 1.9 percentage points. The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. Keeping that in mind, here are two resilient industrials stocks at the top of our wish list and one that may face trouble. Market Cap: $3.66 billion Founded by a Swedish orphan, Matson (NYSE:MATX) is a provider of ocean transportation and logistics services. Why Is MATX Not Exciting? Customers postponed purchases of its products and services this cycle as its revenue declined by 5.3% annually over the last two years Earnings per share have contracted by 11.6% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance Shrinking returns on capital suggest that increasing competition is eating into the company's profitability At $111.98 per share, Matson trades at 11.2x forward P/E. Dive into our free research report to see why there are better opportunities than MATX. Market Cap: $48.92 billion Owning the largest rental fleet in the world, United Rentals (NYSE:URI) provides equipment rental and related services to construction, industrial, and infrastructure industries. Why Could URI Be a Winner? Market share has increased this cycle as its 12.1% annual revenue growth over the last two years was exceptional Highly efficient business model is illustrated by its impressive 25.6% operating margin, and its rise over the last five years was fueled by some leverage on its fixed costs Share repurchases have amplified shareholder returns as its annual earnings per share growth of 16.9% exceeded its revenue gains over the last five years United Rentals's stock price of $752.62 implies a valuation ratio of 16.8x forward P/E. Is now the right time to buy? Find out in our full research report, it's free. Market Cap: $175.1 million Founded by an employee at a real estate rental company, SmartRent (NYSE:SMRT) provides smart home devices and software for multifamily residential properties, single-family rental homes, and student housing communities. Why Are We Positive On SMRT? Offerings are pivotal for their customers' operations as its ARR has averaged 28.5% growth over the past two years Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 43% annually SmartRent is trading at $0.93 per share, or 1.2x forward price-to-sales. Is now the time to initiate a position? See for yourself in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
