Section 1: Company Overview and Fundamental Insights

1.1 Company Overview:

Oilfield service provider, Halliburton Company (NYSE: HAL) offers a broad range of equipment, maintenance, engineering and construction services to the industrial, energy, and government sectors. The company operates in over 70 countries under two reportable segments: (1) Completion and Production and (2) Drilling and Evaluation.

1.2 The Key Positives, Negatives, Investment Highlights, and Risks

1.3 Top 10 Shareholders: The top 10 shareholders together form ~45.97% of the total shareholding. The Vanguard Group, Inc. and Capital World Investors holds a maximum stake in the company at ~11.00% and ~6.99%, respectively.

1.4 Key Metrics: During 2QFY22, the company recorded an operating margin of 7.4% against 4.9% of the Industry Median. In addition, the debt-to-equity ratio has steadily decreased to 1.20x in 2QFY22 compared to 1.78x in 2QFY21. Below depicts the trend of gross margin and asset turnover ratio:

Section 2: Business Updates and Financial Highlights

2.1 Business Updates:

2.2 2QFY22 Performance (Period Ended 30 June 2022): Below highlighted the factors that have influenced the HAL’s performance in the June 2022 quarter:

Section 3: Key Risks & Outlook

Section 4: Stock Recommendation Summary

4.1 Price Performance and Technical Summary

4.2 Fundamental Valuation

Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is September 6, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Disclaimer

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