BAKER HUGHES CO (BKR) Stock Fundamental Analysis
NASDAQ:BKR - Nasdaq - US05722G1004 - Common Stock - Currency: USD
Taking everything into account, BKR scores 5 out of 10 in our fundamental rating. BKR was compared to 63 industry peers in the Energy Equipment & Services industry. While BKR belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. BKR is quite expensive at the moment. It does show a decent growth rate. Finally BKR also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year BKR was profitable.
BKR had a positive operating cash flow in the past year.
In multiple years BKR reported negative net income over the last 5 years.
BKR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
BKR has a better Return On Assets (7.68%) than 71.43% of its industry peers.
With an excellent Return On Equity value of 17.17%, BKR belongs to the best of the industry, outperforming 82.54% of the companies in the same industry.
BKR's Return On Invested Capital of 11.56% is amongst the best of the industry. BKR outperforms 80.95% of its industry peers.
BKR had an Average Return On Invested Capital over the past 3 years of 9.18%. This is in line with the industry average of 8.44%.
The last Return On Invested Capital (11.56%) for BKR is above the 3 year average (9.18%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.68% | ||
| ROE | 17.17% | ||
| ROIC | 11.56% |
ROA(3y)3.76%
ROA(5y)-3.1%
ROE(3y)8.7%
ROE(5y)-6.02%
ROIC(3y)9.18%
ROIC(5y)6.97%
1.3 Margins
The Profit Margin of BKR (10.51%) is better than 74.60% of its industry peers.
In the last couple of years the Profit Margin of BKR has grown nicely.
The Operating Margin of BKR (12.74%) is better than 66.67% of its industry peers.
In the last couple of years the Operating Margin of BKR has grown nicely.
With a Gross Margin value of 21.95%, BKR is not doing good in the industry: 66.67% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of BKR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.74% | ||
| PM (TTM) | 10.51% | ||
| GM | 21.95% |
OM growth 3Y17.25%
OM growth 5Y13.35%
PM growth 3YN/A
PM growth 5Y81.94%
GM growth 3Y2.47%
GM growth 5Y2.69%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BKR is creating some value.
BKR has less shares outstanding than it did 1 year ago.
BKR has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, BKR has an improved debt to assets ratio.
2.2 Solvency
BKR has an Altman-Z score of 2.09. This is not the best score and indicates that BKR is in the grey zone with still only limited risk for bankruptcy at the moment.
BKR's Altman-Z score of 2.09 is in line compared to the rest of the industry. BKR outperforms 58.73% of its industry peers.
BKR has a debt to FCF ratio of 2.99. This is a good value and a sign of high solvency as BKR would need 2.99 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.99, BKR is doing good in the industry, outperforming 63.49% of the companies in the same industry.
BKR has a Debt/Equity ratio of 0.35. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of BKR (0.35) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 2.99 | ||
| Altman-Z | 2.09 |
ROIC/WACC1.26
WACC9.17%
2.3 Liquidity
A Current Ratio of 1.34 indicates that BKR should not have too much problems paying its short term obligations.
With a Current ratio value of 1.34, BKR is not doing good in the industry: 77.78% of the companies in the same industry are doing better.
A Quick Ratio of 0.93 indicates that BKR may have some problems paying its short term obligations.
BKR has a worse Quick ratio (0.93) than 80.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.93 |
3. Growth
3.1 Past
BKR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 40.00%, which is quite impressive.
The Earnings Per Share has been growing by 23.35% on average over the past years. This is a very strong growth
The Revenue has been growing slightly by 6.22% in the past year.
The Revenue has been growing slightly by 3.14% on average over the past years.
EPS 1Y (TTM)40%
EPS 3Y55.53%
EPS 5Y23.35%
EPS Q2Q%18.6%
Revenue 1Y (TTM)6.22%
Revenue growth 3Y10.72%
Revenue growth 5Y3.14%
Sales Q2Q%0.14%
3.2 Future
BKR is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.23% yearly.
BKR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.06% yearly.
EPS Next Y2.3%
EPS Next 2Y7.81%
EPS Next 3Y8.91%
EPS Next 5Y8.23%
Revenue Next Year-1.95%
Revenue Next 2Y0.63%
Revenue Next 3Y1.39%
Revenue Next 5Y2.06%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 16.61, the valuation of BKR can be described as correct.
BKR's Price/Earnings is on the same level as the industry average.
BKR is valuated rather cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 14.78, BKR is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of BKR is on the same level as its industry peers.
BKR is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.61 | ||
| Fwd PE | 14.78 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BKR is valued a bit more expensive than 71.43% of the companies in the same industry.
BKR's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.04 | ||
| EV/EBITDA | 8.49 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates BKR does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of BKR may justify a higher PE ratio.
PEG (NY)7.21
PEG (5Y)0.71
EPS Next 2Y7.81%
EPS Next 3Y8.91%
5. Dividend
5.1 Amount
BKR has a Yearly Dividend Yield of 2.32%.
BKR's Dividend Yield is a higher than the industry average which is at 3.54.
BKR's Dividend Yield is comparable with the S&P500 average which is at 2.37.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
5.2 History
The dividend of BKR has a limited annual growth rate of 4.36%.
BKR has been paying a dividend for at least 10 years, so it has a reliable track record.
BKR has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.36%
Div Incr Years3
Div Non Decr Years10
5.3 Sustainability
BKR pays out 29.22% of its income as dividend. This is a sustainable payout ratio.
The dividend of BKR is growing, but earnings are growing more, so the dividend growth is sustainable.
DP29.22%
EPS Next 2Y7.81%
EPS Next 3Y8.91%
40.7
+0.99 (+2.49%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)
Earnings (Next)
Inst Owners100.96%
Inst Owner Change0%
Ins Owners0.13%
Ins Owner Change21.25%
Market Cap40.32B
Analysts81.33
Price Target47.96 (17.84%)
Short Float %2.39%
Short Ratio3.07
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
Yearly Dividend0.84
Dividend Growth(5Y)4.36%
DP29.22%
Div Incr Years3
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.24%
Min EPS beat(2)5.87%
Max EPS beat(2)10.6%
EPS beat(4)4
Avg EPS beat(4)10.17%
Min EPS beat(4)5.87%
Max EPS beat(4)14.99%
EPS beat(8)8
Avg EPS beat(8)9.27%
EPS beat(12)10
Avg EPS beat(12)2.55%
EPS beat(16)10
Avg EPS beat(16)-4.23%
Revenue beat(2)1
Avg Revenue beat(2)0.51%
Min Revenue beat(2)-1.98%
Max Revenue beat(2)3.01%
Revenue beat(4)2
Avg Revenue beat(4)-0.08%
Min Revenue beat(4)-5.23%
Max Revenue beat(4)3.87%
Revenue beat(8)3
Avg Revenue beat(8)-0.27%
Revenue beat(12)4
Avg Revenue beat(12)-0.97%
Revenue beat(16)5
Avg Revenue beat(16)-1.23%
PT rev (1m)-1.64%
PT rev (3m)-9.13%
EPS NQ rev (1m)-0.09%
EPS NQ rev (3m)-7.93%
EPS NY rev (1m)-0.2%
EPS NY rev (3m)-7.36%
Revenue NQ rev (1m)-0.04%
Revenue NQ rev (3m)-3.74%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)-3.18%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.61 | ||
| Fwd PE | 14.78 | ||
| P/S | 1.45 | ||
| P/FCF | 20.04 | ||
| P/OCF | 12.38 | ||
| P/B | 2.37 | ||
| P/tB | 5.77 | ||
| EV/EBITDA | 8.49 |
EPS(TTM)2.45
EY6.02%
EPS(NY)2.75
Fwd EY6.77%
FCF(TTM)2.03
FCFY4.99%
OCF(TTM)3.29
OCFY8.08%
SpS28.1
BVpS17.2
TBVpS7.05
PEG (NY)7.21
PEG (5Y)0.71
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.68% | ||
| ROE | 17.17% | ||
| ROCE | 13.9% | ||
| ROIC | 11.56% | ||
| ROICexc | 13.99% | ||
| ROICexgc | 26.74% | ||
| OM | 12.74% | ||
| PM (TTM) | 10.51% | ||
| GM | 21.95% | ||
| FCFM | 7.23% |
ROA(3y)3.76%
ROA(5y)-3.1%
ROE(3y)8.7%
ROE(5y)-6.02%
ROIC(3y)9.18%
ROIC(5y)6.97%
ROICexc(3y)10.86%
ROICexc(5y)8.29%
ROICexgc(3y)21.38%
ROICexgc(5y)16.11%
ROCE(3y)11.03%
ROCE(5y)8.4%
ROICexcg growth 3Y31.81%
ROICexcg growth 5Y23.91%
ROICexc growth 3Y30.98%
ROICexc growth 5Y33.59%
OM growth 3Y17.25%
OM growth 5Y13.35%
PM growth 3YN/A
PM growth 5Y81.94%
GM growth 3Y2.47%
GM growth 5Y2.69%
F-Score9
Asset Turnover0.73
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 2.99 | ||
| Debt/EBITDA | 1.27 | ||
| Cap/Depr | 109.4% | ||
| Cap/Sales | 4.47% | ||
| Interest Coverage | 11.82 | ||
| Cash Conversion | 69.52% | ||
| Profit Quality | 68.76% | ||
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.93 | ||
| Altman-Z | 2.09 |
F-Score9
WACC9.17%
ROIC/WACC1.26
Cap/Depr(3y)106.11%
Cap/Depr(5y)93.95%
Cap/Sales(3y)4.69%
Cap/Sales(5y)4.59%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)40%
EPS 3Y55.53%
EPS 5Y23.35%
EPS Q2Q%18.6%
EPS Next Y2.3%
EPS Next 2Y7.81%
EPS Next 3Y8.91%
EPS Next 5Y8.23%
Revenue 1Y (TTM)6.22%
Revenue growth 3Y10.72%
Revenue growth 5Y3.14%
Sales Q2Q%0.14%
Revenue Next Year-1.95%
Revenue Next 2Y0.63%
Revenue Next 3Y1.39%
Revenue Next 5Y2.06%
EBIT growth 1Y25.69%
EBIT growth 3Y29.82%
EBIT growth 5Y16.91%
EBIT Next Year36.41%
EBIT Next 3Y16.7%
EBIT Next 5Y11.57%
FCF growth 1Y61.48%
FCF growth 3Y10.61%
FCF growth 5Y18.31%
OCF growth 1Y43.04%
OCF growth 3Y11.96%
OCF growth 5Y9.4%