Halliburton (NYSE:HAL) reports earnings tomorrow morning. DA Davidson expects a beat (revenue/EBITDA/EPS of $3.95B/$486M/$(0.05) vs. consensus of $3.90B/$469M/$(0.07)).
"Based on the strength of the recovery in the North American rig count and continued market share gains during the downturn, we expect HAL’s 3Q16 results to largely beat current top and bottom line expectations. Although, it may take a few more quarters for larger operators (HAL’s core customer base) to adjust capex budgets and increase activity, a slight miss would only add to the trajectory of future earnings."
"We expect the level of service intensity to increase significantly in coming quarters as larger operators gain comfort with the recovery in commodity prices and adjust 2017 capex budgets higher."
Increases price target to $57 from $54. Implied upside 23%.