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Omar Venerio
Omar Venerio
Articles (1720) 

Monday Morning Market Highlights

Markets in the red, shares of Halliburton jumps on quarterly results

US Markets

U.S. stocks were in the red on Monday morning. The Dow fell 0.01% to 28,603, the S&P 500 index lost 0.04% to 3,482 and the Nasdaq Composite Index was down 0.03% to 11,668.

Gainers

• L Brands Inc​ (NYSE:LB) +4.95%

• Kansas City Southern (NYSE:KSU) +3.7%

• Tapestry Inc (NYSE:TPR) +4%

• Freeport-McMoRan Inc (NYSE:FCX) +3.95%

• General Electric (NYSE:GE) +2.3%

Losers

• EOG Resources Inc (NYSE:EOG) -1.7%

• VF Corp (NYSE:VFC) -1.1%

• Kimco Realty Corp (NYSE:KIM) -0.8%

• Martin Marietta Materials Inc (NYSE:MLM) -0.8%

Global Markets

The main European stock markets were mixed. The U.K.'s FTSE 100 fell 0.35%, France's CAC 40 advanced 0.24%, Germany's Dax was down 0.22% and Spain's Ibex 35 gained 0.12%.

In Asia, Japan's Nikkei 225 gained 1.11%, India's BSE Sensex advanced 1.12%, Hong Kong's Hang Seng jumped 0.64% and China's Shanghai Composite was down 0.71%.

Halliburton releases earnings report

Shares of Halliburton Company (HAL) gained more than 2% on Monday morning after the company announced financial results for its third quarter of fiscal 2020. It posted earnings per share of 11 cents, beating analyst´s estimates by 2 cents, on revenue of $2.98 billion, which declined 46.3% year-over-year and fell short of expectations by $140 million.

Chairman, President and CEO Jeff Miller had the following to say:

"The fundamentally different course we are charting is having a positive impact on our performance. Halliburton's strong third quarter results demonstrate that we are effectively executing on our strategic priorities…Total company revenue was about $3.0 billion and adjusted operating income was $275 million. We improved our margin performance both internationally and in North America and are on track to generate over $1.0 billion in free cash flow for the year."

In the third quarter, the Completion and Production revenue reached $1.6 billion, a decrease of $98 million, or 6%, when compared to the same quarter of 2020. This reduction was driven by reduced completion tool sales across Europe and Africa, the Gulf of Mexico and Latin America, as well as lower cementing activity in the Middle East, Asia and North America.

Drilling and Evaluation revenue was $1.4 billion, down $123 million, or 8%, when compared to the second quarter of 2020. The decline was provoked by reduced drilling-related and wireline services in North America and the Eastern Hemisphere. The operating income was $105 million, which was down $22 million, or 17%, over the same period.

By geographic regions, North America revenue was $984 million, a 6% decrease when compared to the second quarter of 2020 due to a decline in well construction activity in U.S. land. International revenue reached $2.0 billion, a 7% decrease when compared to the second quarter of 2020, as a consequence of reduced well construction and project management activity in the Middle East and Asia. In Latin America, revenue was $380 million, a 10% increase sequentially, from increased activity in Argentina, Colombia and Mexico. In Europe and Africa, revenue was $649 million, a 6% decrease sequentially, due to lower completion tool sales across the region, reduced drilling-related services in Norway and a decline in fluids and cementing activity in Russia. Middle East/Asia revenue was $962 million, a 13% decrease sequentially, due to reduce well construction activity and lower project management and wireline activity in India.

At the end of September, the T Rowe Price Equity Income Fund (Trades, Portfolio) cut its investment in the stock by 8% to 5,825,000 shares.

Disclosure: The author holds no positions in any stocks mentioned.

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About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor and Area Head of Finance. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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