Will Halliburton Earnings Outshine Schlumberger and Baker Hughes?

Halliburton (NYSE: HAL  ) will release its quarterly report on Monday, and investors have even higher hopes for the oil-services giant than they did earlier this week. Rivals Schlumberger (NYSE: SLB  ) and Baker Hughes (NYSE: BHI  ) both posted sharp gains on Friday after reporting strong results of their own, suggesting that the overall industry environment is favorable enough to boost Halliburton earnings as well.

Halliburton has been a huge player in the hydraulic fracturing industry in the U.S., with a history in fracking techniques that began with experiments more than 65 years ago. As opportunities have arisen around the world, Halliburton has followed Schlumberger's lead in increasingly becoming a global player in the energy-services industry, carrying its expertise to areas with little previous exposure to its innovative techniques. But can Halliburton do as good a job as Baker Hughes and Schlumberger have in making the most of the worldwide energy boom? Let's take an early look at what's been happening with Halliburton over the past quarter and what we're likely to see in its report.

Stats on Halliburton

Analyst EPS Estimate

$0.82

Change From Year-Ago EPS

22%

Revenue Estimate

$7.5 billion

Change From Year-Ago Revenue

5.4%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Can Halliburton earnings beat its rivals this quarter?
Analysts have had somewhat mixed views on Halliburton earnings in recent months. They've reduced their third-quarter estimates by $0.02 per share, but they've boosted their full-year 2014 projections by 6%, pointing to longer-term growth ahead. The stock has taken the more bullish long-term view, rising 18% since mid-July.

Halliburton actually came into the quarter on a somewhat weak note. Flag rig counts and a general reduction in drilling activity in North America weighed especially hard on Halliburton, which gets the lion's share of its revenue from the region. Yet emulating Schlumberger's success, Halliburton has been more aggressive about pushing into international markets, which now add up to almost half of total sales. That has given Halliburton an edge over Baker Hughes, which hasn't been able to expand internationally as quickly as its peers.

But results from Baker Hughes and Schlumberger paint a potentially rosy picture for Halliburton. Baker Hughes soared more than 7% on Friday after reporting solid results that came in well above expectations. Earnings growth of 22% outpaced even Schlumberger's solid 20% showing, even though Schlumberger's revenue managed a double-digit percentage increase to beat out Baker Hughes' 8% sales growth. Both companies gained from rising activity off the North American coast as well as throughout areas in the Middle East and Asia. With Halliburton having extensive offshore operations with a focus on deepwater solutions, it could also share in those gains.

Unfortunately, Halliburton continues to struggle with ongoing fallout from the Gulf oil spill three years ago. Despite the closure of a Justice Department investigation of the Macondo explosion last month, trials related to the incident continue, and litigation will almost certainly stretch at least into next year. Despite efforts to move beyond the tragedy, Halliburton's role will make some customers think twice before choosing it rather than Schlumberger or Baker Hughes.

In the Halliburton earnings report, watch to see how well the company performs compared to its peers. Growth by itself won't be enough to make investors happy, but if Halliburton grows faster than Baker Hughes and Schlumberger, it should help support the stock in the days and weeks to come.

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