Major oilfield services provider
) increased its first quarter 2013 dividend by 39% to 12.5 cents
per share (50 cents per share annualized). The new distribution
will be paid on Mar 27, 2013 to shareholders of record as of Mar
The company also revealed its plan to distribute around 15% to
20% of its annual net income by way of dividend, subject to
approval by the board of directors.
The dividend hike reflects continued strong performance by the
company, backed by solid operating results, good investments and
a diligent execution of its strategic plan. We believe that
Halliburton will be able to generate sufficient cash flows for
its shareholders in the coming years, which will likely be backed
by strong operating performances and good management decisions.
As of Dec 31, 2012, the company had approximately $2.5 billion in
cash/cash equivalents and $4.8 billion in long-term debt,
representing a debt-to-capitalization ratio of 23.4%.
We believe that the increase in dividend will boost investors'
confidence in the stock, thereby driving unit value.
The company currently retains a Zacks Rank #3 (Hold), implying
that it is expected to perform in line with the broader U.S.
equity market over the next one to three months.
Halliburton is among the top three players in each of its
product/service categories, and is present in all major
hydrocarbon-producing regions of the world. The company enjoys
strong relationships with both publicly traded and national oil
However, the company has operations in over 70 countries, with
approximately a fifth of its total operating income coming from
international markets. As such, the company is exposed to risks
associated with doing business abroad. Such risks include
embargoes or expropriation of assets, exchange rate risks,
terrorism and political/civil sentiment.
But there are certain other oilfield services providers that are
expected to perform well in the coming 1 to 3 months. These
Compressco Partners, L.P.
) with a Zacks Rank #1 (Strong Buy), and
Core Laboratories N.V.
Dawson Geophysical Company
) with Zacks Rank #2 (Buy).
CORE LABS NV (CLB): Free Stock Analysis
DAWSON GEOPHYS (DWSN): Free Stock Analysis
COMPRESSCO PTNR (GSJK): Free Stock Analysis
HALLIBURTON CO (HAL): Free Stock Analysis
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