Earnings Previews: Halliburton, HCA, Philip Morris, Synchrony

With the first week of the June-quarter earnings season behind us, we are looking ahead to what the coming week has in store. On Thursday, we previewed three companies scheduled to report quarterly results before Monday’s opening bell: AutoNation, Prologis and Tractor Supply.

We also have previewed three firms that are set to report earnings after markets close Monday afternoon: IBM, PPG and Steel Dynamics.

Here’s a look at four firms set to report results before markets open on Tuesday.

Halliburton

Over the past 12 months, crude oil prices have increased by more than 70%. In that same span, shares of oil field services company Halliburton Inc. (NYSE: HAL) have risen by 56.5%. If (or when) U.S. exploration and production companies decide the price of oil is high enough to warrant more drilling, Halliburton and its peers should get an even bigger boost. But last year was also a big loser for all parts of the fossil-fuel industry as the coronavirus essentially shut down travel, either to the store or halfway around the world.

Surveyed analysts are mostly bullish on the stock, with 15 of 26 rating the shares a Buy or Strong Buy. Another eight analysts rate the stock a Hold. Based on a median price target of $26 and a current price of around $20, upside potential is 30%. At the high price target of $32, upside potential reaches 60%.

Revenue is forecast to come in at $3.69 billion, up 7% sequentially and more than 15% year over year. Adjusted earnings per share (EPS) are forecast to be $0.23 for the quarter, four cents more sequentially and 78% higher year over year. Analysts are forecasting full-year revenue of $14.94 billion, up about 3.4% year over year, and adjusted EPS of $0.97, up nearly 50%. On a GAAP basis, Halliburton posted a loss in every quarter last year and a full-year loss of $3.34.

Halliburton’s stock trades at around 22.1 times expected 2021 EPS, 15.1 times estimated 2022 EPS and 12.2 times estimated 2023 earnings. The 52-week trading range is $10.60 to $25.00. The company pays an annual dividend of $0.18 (yield of 0.81%).

HCA

HCA Healthcare Inc. (NYSE: HCA) has more than doubled its share price over the past 12 months. Since the beginning of the year, the company’s stock has risen about 35%. The coronavirus pandemic forced HCA and other hospital operators to seek out ways to keep margins up while costs were rising. Selling off non-performing assets and reining in costs have set the stage for what some analysts believe is a longer-run rally for hospitals.

Of 23 analysts covering the stock, 18 rate the shares a Buy or Strong Buy, and four put a Hold rating on the stock. At around $220 a share and with a median price target of $225, upside potential is just 2.3%. At the high price target of $260, the upside potential is 18.2%.

Analysts are forecasting second-quarter revenue of $13.61 billion, down 2.6% sequentially but up by 23% year over year. Adjusted EPS is forecast to more than double to $3.16 year over year but decline by nearly 24% sequentially. For the full year, analysts are currently forecasting EPS of $14.09, up 21.4%, and revenue of $55.25 billion, up 7.2%.

At the current price, HCA’s stock trades at around 15.4 times expected 2021 EPS, 14.2 times estimated 2022 EPS and 12.8 times estimated 2023 earnings. The stock’s 52-week range is $103.17 to $221.71. The company pays an annual dividend of $1.92 (yield of 0.88%).

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