Critical Comparison: Halliburton (NYSE:HAL) & TechnipFMC (NYSE:FTI)

Halliburton (NYSE:HAL – Get Free Report) and TechnipFMC (NYSE:FTI – Get Free Report) are both large-cap energy companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, valuation and dividends.

Profitability

This table compares Halliburton and TechnipFMC’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Halliburton 8.90% 18.36% 7.84%
TechnipFMC 12.04% 39.82% 13.01%

Earnings and Valuation

This table compares Halliburton and TechnipFMC”s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Halliburton $22.18 billion 1.22 $1.28 billion $2.39 13.70
TechnipFMC $9.93 billion 2.54 $963.90 million $3.18 20.43

Halliburton has higher revenue and earnings than TechnipFMC. Halliburton is trading at a lower price-to-earnings ratio than TechnipFMC, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations for Halliburton and TechnipFMC, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Halliburton 1 5 18 0 2.71
TechnipFMC 0 2 10 2 3.00

Halliburton currently has a consensus target price of $43.86, indicating a potential upside of 33.90%. TechnipFMC has a consensus target price of $78.18, indicating a potential upside of 20.33%. Given Halliburton’s higher possible upside, equities analysts clearly believe Halliburton is more favorable than TechnipFMC.

Risk and Volatility

Halliburton has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, TechnipFMC has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500.

Dividends

Halliburton pays an annual dividend of $0.68 per share and has a dividend yield of 2.1%. TechnipFMC pays an annual dividend of $0.20 per share and has a dividend yield of 0.3%. Halliburton pays out 28.5% of its earnings in the form of a dividend. TechnipFMC pays out 6.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Halliburton has raised its dividend for 4 consecutive years and TechnipFMC has raised its dividend for 1 consecutive years. Halliburton is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

85.2% of Halliburton shares are owned by institutional investors. Comparatively, 96.6% of TechnipFMC shares are owned by institutional investors. 0.6% of Halliburton shares are owned by company insiders. Comparatively, 1.4% of TechnipFMC shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

TechnipFMC beats Halliburton on 12 of the 18 factors compared between the two stocks.

About Halliburton

(Get Free Report)

Halliburton Company (NYSE: HAL) is a global provider of products and services for the energy industry. The company supports the exploration, development, and production of oil and natural gas through technologies and services used throughout the life cycle of a well. Halliburton operates through two primary business segments: Completion and Production, and Drilling and Evaluation. Its offerings include cementing, stimulation, well completion, production enhancement, drilling services, drilling fluids, well testing, wireline and perforating services, formation evaluation, and project management.

About TechnipFMC

(Get Free Report)

TechnipFMC is a global technology and services company serving the energy industry. It designs and delivers equipment and solutions for offshore and onshore oil and gas projects, with a particular focus on subsea production and related services. Its offerings include subsea production systems, subsea installation and project services, and surface wellhead and production equipment. TechnipFMC also provides engineering and project-management capabilities, working with customers to develop and operate energy projects.

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