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Baker Hughes Inc. (BHI)

- NYSE
  • Fri, Mar. 13, 2:14 PM
    • The U.S. oil rig count falls for the 14th straight week, down by another 56 to 866 rigs for its lowest level since March 2011, according to the latest data from Baker Hughes (NYSE:BHI).
    • There are now ~46% fewer oil rigs working since a peak of 1,609 in October, but that has not yet translated into a drop in actual production.
    • Combined, both oil and gas rigs fell by 67 to 1,125, down 686 from 1,809 at this stage a year ago; gas rigs were lower by 11 to 257.
    • U.S. crude prices already had dropped sharply - now -4.2% to just above $45/bbl - after the IEA said a global oil glut is building and U.S. oil production shows no signs of slowing.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 55 Comments
  • Fri, Mar. 6, 1:19 PM
    • The U.S. rig count declined by 75 this week to 1,192, picking up the pace from last week's 43 rigs taken out of service, the 13th consecutive week of total decline and the lowest reading since the week ending Dec. 31, 2009, according to the latest survey from Baker Hughes (NYSE:BHI).
    • Drillers idled 64 oil rigs to 922, the lowest number of oil rigs in use since April 2011 and down 43% since October.
    • Per drilling region, the biggest decline came from Texas' Permian shale basin, where 22 rigs were shut down, while 8 Eagle Ford rigs were shut.
    • ETFs: USO, OIL, UCO, SCO, BNO, UGA, DTO, DBO, UWTI, USL, DWTI, UHN, DNO, SZO, OLO, TWTI, OLEM
    | 26 Comments
  • Wed, Mar. 4, 10:41 AM
    • Baker Hughes (BHI -0.9%) is downgraded to Sector Perform from Focus Stock at Scotia Howard Weil, as enthusiasm for the merger with Halliburton appears to have dimmed a bit.
    • Weil says it believed the deal would close at the terms offered, and that the sizable spread between BHI and HAL at the time of the announced merger (~12%) represented a compelling investment opportunity; the spread has since narrowed to ~7%, still above a prudent "time value" discount but certainly less attractive.
    | Comment!
  • Thu, Feb. 26, 6:38 PM
    • Credit Suisse says the recent rally in oil prices and in oilfield services stocks (NYSEARCA:OIH) is a classic dead cat bounce, and that as soon as U.S. storage gets full - and it is close - crude prices will fall, bringing expectations and stocks down with it.
    • The firm says its sector outlook is increasingly negative as companies report increased pricing pressure, a record drop in the activity barometer of the rig count, and offshore rigs and projects confronting headwinds that could take a couple of years to fix.
    • Relevant stocks: SLB, HAL, BHI, CAM, HLX, SPN, NOV, FET, DRQ, FTI, OIS
    | 24 Comments
  • Fri, Feb. 20, 2:17 PM
    • The active U.S. rig count fell by another 48 units this week, the 11th consecutive week of declines but one of the smallest drops in the past two months, according to the latest survey from Baker Hughes (NYSE:BHI).
    • The U.S. oil-rig count fell by 37 to 1,019, while gas rigs were down 11 to 289 this week; however, the U.S. offshore rig count is at 54, up two rigs from last week and down three from this time last year.
    • Compared with a year ago, this week’s total of 1,310 down is down 461 from 1,771.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, XES, IEZ, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 38 Comments
  • Thu, Feb. 19, 6:30 PM
    • Saudi Aramco, whose prolific production has contributed to the drop in oil prices, is starting to feel the pain from its country’s decision to keep pumping and is now asking contractors for steep discounts in an effort to cut costs, according to a WSJ report.
    • The Saudi oil company reportedly summoned oil services companies including Schlumberger (NYSE:SLB), Halliburton (NYSE:HAL) and Baker Hughes (NYSE:BHI) to ask for discounts of up to 20% on certain services such as well testing procedures; the companies do a combined $6B/year in business with Aramco.
    • The Saudi company also is said to have delayed plans to build a $2B clean fuels plant and held up deepwater oil and gas exploration and drilling activities in the Red Sea because their profitability is now in question.
    • Aramco is considering slashing E&P spending to $30B/year from $40B while oil prices remain low, industry sources say.
    | 11 Comments
  • Tue, Feb. 17, 12:48 PM
    • ValueAct Capital has acquired ~30M shares in Halliburton (HAL +0.6%) alongside its activist holdings in Baker Hughes (BHI +0.4%), ~3.5% of HAL’s outstanding shares, Bloomberg reports, as it strongly backs the agreed merger of the two oilfield services providers.
    • ValueAct disclosed in a Jan. 16 filing it owned ~22M shares in BHI, a 5.1% stake; by buying into both sides, it is betting nearly $3B that cost and tax savings will strengthen the combined company amid turmoil in the energy industry and position it to benefit from a recovery.
    • Amid volatile energy prices, BHI consistently has traded below the $78.62 price when the HAL deal became public.
    | Comment!
  • Tue, Feb. 17, 10:19 AM
    • U.S. and European suppliers to the oil industry are still able to seek work in Russia’s Arctic despite sanctions designed to limit their involvement because the rules do not apply to international subsidiaries, according to a Bloomberg report.
    • Schlumberger’s (SLB -0.6%) Russian unit bid in a December tender to supply drilling fluids to an offshore Arctic project operated by Gazprom Neft, and in the prior month, Baker Hughes’ (BHI -0.4%) local unit and a Panamanian unit of Schlumberger offered drilling services at the same field.
    • Neither company has been accused of breaking any laws, and none of the bids was successful, but the use of subsidiaries to legally skirt sanctions will raise questions about the effectiveness of measures imposed to punish Russia.
    | 10 Comments
  • Fri, Feb. 13, 2:19 PM
    • The number of active U.S. land rigs plunged by 98 this week to settle at 1,358, in one of the biggest declines in the past three decades, Baker Hughes (NYSE:BHI) reports in its latest weekly survey.
    • The total is the lowest since Feb. 26, 2010, and 406 fewer units compared with this week a year ago; the count has now fallen 11 consecutive weeks, losing 562 units during that time.
    • Oil rigs lost 84 units to 1,056, while gas rigs lost 14 units to 300.
    • Texas, home to 44% of U.S. rigs, gave up 56 units to settle at 598 for its lowest total since Mar. 26, 2010; the state has lost 307 rigs since Nov. 21.
    • New Mexico dropped 12 units to 66, while North Dakota lost 9 to 123, both multi-year lows.
    • Nymex crude +2.5% at ~$52.50/bbl; Brent +3.1% at ~$61.15.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, XES, IEZ, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 40 Comments
  • Tue, Feb. 10, 6:31 PM
    • Halliburton (NYSE:HAL) and Baker Hughes (NYSE:BHI) say they received a second request for more information from U.S. antitrust regulators related to the proposed merger of the oilfield services companies.
    • HAL and BHI say the notice was expected but will delay the deal’s closing until 30 days after both companies have complied with the request.
    • The deal has been expected to face stiff scrutiny from the Justice Department because the two companies have overlapping business units not only in the U.S. but also in Asia and Europe.
    | 6 Comments
  • Fri, Feb. 6, 2:19 PM
    • The U.S. drilling rig count plunged another 87 units to settle at 1,456 working rigs, according to Baker Hughes (NYSE:BHI) latest weekly survey.
    • The total is the lowest since March 2010, and 315 units fewer than in the same week last year; the count has now fallen for 10 straight weeks, losing 464 units during that time (435 targeting oil).
    • Oil rigs plummeted 83 units to 1,140, while gas rigs fell five units to 314.
    • Horizontal drilling rigs tumbled by 80 units to 1,088; 284 units have gone offline just since Nov. 21.
    • The monthly U.S. rig count for January averaged 1,683, down 199 from December and 86 lower than in Jan. 2014.
    • ETFs: USO, OIL, UCO, OIH, SCO, BNO, DTO, DBO, XES, IEZ, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 64 Comments
  • Fri, Jan. 30, 2:19 PM
    • The number of oil and gas rigs active in the U.S. fell another 90 units to 1,543 for the biggest one-week decline for oil rigs since 1987, according to the latest weekly survey from Baker Hughes (NYSE:BHI).
    • The total is the lowest since June 2010, and 242 units fewer than in the same week a year ago; the count has now fallen in nine consecutive weeks, losing 377 units during the period.
    • Oil rigs plunged 94 units to 1,223, while gas rigs gained three units to 319.
    • In Texas, 58 rigs were taken off the market, cutting the state’s count to 695 rigs, down from 840 at the beginning of this month.
    • ETFs: USO, OIL, UCO, OIH, SCO, BNO, DTO, DBO, XES, IEZ, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 55 Comments
  • Fri, Jan. 23, 2:15 PM
    • The number of oil and gas rigs in use in the U.S. fell by 43 last week to 1,633, bringing the rig count to its lowest level since Aug. 2010, according to the latest data from Baker Hughes (NYSE:BHI).
    • The count has now fallen in eight consecutive weeks, losing 287 units during that period; the U.S. now has 144 fewer rigs working than in the same week a year ago.
    • 42 of the 43 units that went offline in the past week were land-based, bringing the total to 1,568 and culminating a drop of 176 units in three weeks.
    • Oil rigs plunged 49 units to 1,317, while gas rigs gained six units to 316.
    • ETFs: USO, OIL, UCO, SCO, BNO, DTO, DBO, UWTI, USL, DWTI, DNO, SZO, OLO, TWTI, OLEM
    | 19 Comments
  • Thu, Jan. 22, 12:08 PM
    • Baker Hughes (NYSE:BHI) declares $0.17/share quarterly dividend, in line with previous.
    • Forward yield 1.17%
    • Payable March 25; for shareholders of record March 4; ex-div March 2.
    | Comment!
  • Wed, Jan. 21, 6:56 PM
    • Commenting on the proposed merger between Halliburton (NYSE:HAL) and Baker Hughes (NYSE:BHI), Morgan Stanley thinks the oil industry downturn may help HAL overcome antitrust hurdles, as weak oil prices make it harder to argue that market share power will translate into pricing power.
    • The weaker market also is likely to increase the value of the $2B in cost synergies HAL expects to achieve from the deal, given its much more depressed earnings figures, the firm adds.
    • Stanley lowers its earnings estimates for HAL but maintains its stock price valuation of $50/share.
    | Comment!
  • Tue, Jan. 20, 8:37 AM
    • Baker Hughes (NYSE:BHI) +1.6% premarket after easily beating Q4 earnings estimates but warning of a difficult 2015, similar to concerns discussed today in Halliburton's earnings report.
    • "While market demand ended up being more resilient in the fourth quarter than many had predicted, the recent declines seen in rig counts will clearly affect results in 2015," BHI CEO Martin Craighead says.
    • Q4 revenue at BHI's North American segment jumped 20.4% to $3.3B, Middle East/Asia Pacific revenue rose 13%, Europe/Africa/Russia added 5%, and Latin America revenue slipped 2%.
    • BHI says it realized its best pressure pumping margins in three years and hit its goal of mid-teens operating margins in North America; international results exceeded forecasts, driven by a surge in year-end product sales.
    • Says it will lay off 7,000 employees, mostly in the current quarter, and is reviewing its facilities for possible closures; expects to book a one-time charge of $160M-$185M.
    • On Friday, activist investor ValueAct Capital Management reported a 5.1% stake in BHI, an unusual move since the company is being bought by Halliburton; ValueAct began buying the week after the deal was announced in November.
    | Comment!
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Company Description
Baker Hughes Inc operates in the oilfield services industry. It provides products and services for drilling and evaluation of oil and gas wells, completion and production of oil and gas wells, fluids and chemicals and reservoir technology.