BAKER HUGHES CO (BKR) Stock Fundamental Analysis
NASDAQ:BKR - Nasdaq - US05722G1004 - Common Stock - Currency: USD
Taking everything into account, BKR scores 6 out of 10 in our fundamental rating. BKR was compared to 59 industry peers in the Energy Equipment & Services industry. BKR scores excellent on profitability, but there are some minor concerns on its financial health. BKR is not valued too expensively and it also shows a decent growth rate. BKR also has an excellent dividend rating. This makes BKR very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
BKR had positive earnings in the past year.
In the past year BKR had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: BKR reported negative net income in multiple years.
In the past 5 years BKR always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 7.77%, BKR is in the better half of the industry, outperforming 68.97% of the companies in the same industry.
The Return On Equity of BKR (17.63%) is better than 79.31% of its industry peers.
BKR's Return On Invested Capital of 11.32% is amongst the best of the industry. BKR outperforms 84.48% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for BKR is in line with the industry average of 8.19%.
The last Return On Invested Capital (11.32%) for BKR is above the 3 year average (9.18%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.77% | ||
| ROE | 17.63% | ||
| ROIC | 11.32% |
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
With a decent Profit Margin value of 10.70%, BKR is doing good in the industry, outperforming 74.14% of the companies in the same industry.
BKR's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 12.42%, BKR is in the better half of the industry, outperforming 65.52% of the companies in the same industry.
In the last couple of years the Operating Margin of BKR has grown nicely.
Looking at the Gross Margin, with a value of 21.25%, BKR is doing worse than 63.79% of the companies in the same industry.
In the last couple of years the Gross Margin of BKR has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.42% | ||
| PM (TTM) | 10.7% | ||
| GM | 21.25% |
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.
The number of shares outstanding for BKR has been reduced compared to 1 year ago.
Compared to 5 years ago, BKR has more shares outstanding
BKR has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.24 indicates that BKR is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.24, BKR is in the better half of the industry, outperforming 65.52% of the companies in the same industry.
BKR has a debt to FCF ratio of 2.93. This is a good value and a sign of high solvency as BKR would need 2.93 years to pay back of all of its debts.
BKR has a better Debt to FCF ratio (2.93) than 63.79% of its industry peers.
A Debt/Equity ratio of 0.35 indicates that BKR is not too dependend on debt financing.
BKR has a Debt to Equity ratio (0.35) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 2.93 | ||
| Altman-Z | 2.24 |
ROIC/WACC1.24
WACC9.13%
2.3 Liquidity
A Current Ratio of 1.32 indicates that BKR should not have too much problems paying its short term obligations.
BKR has a worse Current ratio (1.32) than 77.59% of its industry peers.
A Quick Ratio of 0.94 indicates that BKR may have some problems paying its short term obligations.
With a Quick ratio value of 0.94, BKR is not doing good in the industry: 82.76% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
BKR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 48.13%, which is quite impressive.
Measured over the past years, BKR shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.35% on average per year.
Looking at the last year, BKR shows a quite strong growth in Revenue. The Revenue has grown by 9.10% in the last year.
BKR shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.14% yearly.
EPS 1Y (TTM)48.13%
EPS 3Y55.53%
EPS 5Y23.35%
EPS Q2Q%37.25%
Revenue 1Y (TTM)9.1%
Revenue growth 3Y10.72%
Revenue growth 5Y3.14%
Sales Q2Q%7.74%
3.2 Future
BKR is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.73% yearly.
Based on estimates for the next years, BKR will show a small growth in Revenue. The Revenue will grow by 1.72% on average per year.
EPS Next Y11.45%
EPS Next 2Y13.44%
EPS Next 3Y12.89%
EPS Next 5Y6.73%
Revenue Next Year1.47%
Revenue Next 2Y2.48%
Revenue Next 3Y2.96%
Revenue Next 5Y1.72%
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 19.25, the valuation of BKR can be described as rather expensive.
60.34% of the companies in the same industry are more expensive than BKR, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of BKR to the average of the S&P500 Index (29.63), we can say BKR is valued slightly cheaper.
A Price/Forward Earnings ratio of 17.27 indicates a rather expensive valuation of BKR.
BKR's Price/Forward Earnings is on the same level as the industry average.
The average S&P500 Price/Forward Earnings ratio is at 22.68. BKR is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.25 | ||
| Fwd PE | 17.27 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BKR is valued a bit more expensive than the industry average as 77.59% of the companies are valued more cheaply.
BKR's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.99 | ||
| EV/EBITDA | 10.46 |
4.3 Compensation for Growth
BKR's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of BKR may justify a higher PE ratio.
BKR's earnings are expected to grow with 12.89% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.68
PEG (5Y)0.82
EPS Next 2Y13.44%
EPS Next 3Y12.89%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.99%, BKR has a reasonable but not impressive dividend return.
BKR's Dividend Yield is a higher than the industry average which is at 3.47.
Compared to an average S&P500 Dividend Yield of 2.29, BKR has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
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
28.06% of the earnings are spent on dividend by BKR. This is a low number and sustainable payout ratio.
The dividend of BKR is growing, but earnings are growing more, so the dividend growth is sustainable.
DP28.06%
EPS Next 2Y13.44%
EPS Next 3Y12.89%
45.62
-1.29 (-2.75%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)
Earnings (Next)
Inst Owners97.23%
Inst Owner Change0%
Ins Owners0.09%
Ins Owner Change13.28%
Market Cap45.17B
Analysts80.65
Price Target48.82 (7.01%)
Short Float %1.38%
Short Ratio1.94
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
Yearly Dividend0.84
Dividend Growth(5Y)4.36%
DP28.06%
Div Incr Years3
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)9.91%
Min EPS beat(2)9.21%
Max EPS beat(2)10.6%
EPS beat(4)4
Avg EPS beat(4)10.59%
Min EPS beat(4)7.56%
Max EPS beat(4)14.99%
EPS beat(8)8
Avg EPS beat(8)9.34%
EPS beat(12)9
Avg EPS beat(12)0.06%
EPS beat(16)10
Avg EPS beat(16)-4.18%
Revenue beat(2)1
Avg Revenue beat(2)-1.11%
Min Revenue beat(2)-5.23%
Max Revenue beat(2)3.01%
Revenue beat(4)2
Avg Revenue beat(4)0.36%
Min Revenue beat(4)-5.23%
Max Revenue beat(4)3.87%
Revenue beat(8)4
Avg Revenue beat(8)0.32%
Revenue beat(12)4
Avg Revenue beat(12)-1.19%
Revenue beat(16)5
Avg Revenue beat(16)-1.2%
PT rev (1m)2.42%
PT rev (3m)10.08%
EPS NQ rev (1m)-9.22%
EPS NQ rev (3m)-6.77%
EPS NY rev (1m)1.96%
EPS NY rev (3m)1.68%
Revenue NQ rev (1m)-2.25%
Revenue NQ rev (3m)-4.62%
Revenue NY rev (1m)-0.75%
Revenue NY rev (3m)-0.93%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.25 | ||
| Fwd PE | 17.27 | ||
| P/S | 1.62 | ||
| P/FCF | 21.99 | ||
| P/OCF | 13.56 | ||
| P/B | 2.67 | ||
| P/tB | 6.58 | ||
| EV/EBITDA | 10.46 |
EPS(TTM)2.37
EY5.2%
EPS(NY)2.64
Fwd EY5.79%
FCF(TTM)2.07
FCFY4.55%
OCF(TTM)3.37
OCFY7.38%
SpS28.11
BVpS17.06
TBVpS6.93
PEG (NY)1.68
PEG (5Y)0.82
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.77% | ||
| ROE | 17.63% | ||
| ROCE | 13.62% | ||
| ROIC | 11.32% | ||
| ROICexc | 13.39% | ||
| ROICexgc | 25.13% | ||
| OM | 12.42% | ||
| PM (TTM) | 10.7% | ||
| GM | 21.25% | ||
| FCFM | 7.38% |
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)10.7%
ROICexc(5y)8.19%
ROICexgc(3y)20.8%
ROICexgc(5y)15.76%
ROCE(3y)11.03%
ROCE(5y)8.4%
ROICexcg growth 3Y28.92%
ROICexcg growth 5Y22.28%
ROICexc growth 3Y29.47%
ROICexc growth 5Y32.66%
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 | 2.93 | ||
| Debt/EBITDA | 1.3 | ||
| Cap/Depr | 112.5% | ||
| Cap/Sales | 4.59% | ||
| Interest Coverage | 11.59 | ||
| Cash Conversion | 72.58% | ||
| Profit Quality | 68.95% | ||
| Current Ratio | 1.32 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z | 2.24 |
F-Score9
WACC9.13%
ROIC/WACC1.24
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)48.13%
EPS 3Y55.53%
EPS 5Y23.35%
EPS Q2Q%37.25%
EPS Next Y11.45%
EPS Next 2Y13.44%
EPS Next 3Y12.89%
EPS Next 5Y6.73%
Revenue 1Y (TTM)9.1%
Revenue growth 3Y10.72%
Revenue growth 5Y3.14%
Sales Q2Q%7.74%
Revenue Next Year1.47%
Revenue Next 2Y2.48%
Revenue Next 3Y2.96%
Revenue Next 5Y1.72%
EBIT growth 1Y29.21%
EBIT growth 3Y29.82%
EBIT growth 5Y16.91%
EBIT Next Year44.2%
EBIT Next 3Y19.42%
EBIT Next 5Y9.98%
FCF growth 1Y11.75%
FCF growth 3Y10.61%
FCF growth 5Y18.31%
OCF growth 1Y8.82%
OCF growth 3Y11.96%
OCF growth 5Y9.4%