Baker Hughes Co (NASDAQ: BKR)

Sector: Energy Industry: Oil & Gas Equipment & Services CIK: 0001701605
Market Cap 59.13 Bn
P/B 3.14
P/E 22.85
P/S 2.13
ROIC (Qtr) 21.37
Div Yield % 1.54
Rev 1y % (Qtr) 0.30
Total Debt (Qtr) 6.09 Bn
Debt/Equity (Qtr) 0.32
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About

Baker Hughes Company, often referred to as Baker Hughes, is a prominent player in the energy technology industry, with the ticker symbol BKR. The company has built a solid reputation for innovation, technology, and customer service over its century-long history, with operations spanning more than 120 countries worldwide. Baker Hughes' main business activities revolve around the energy and industrial value chain, with a diverse portfolio of technologies and services. The company operates through two primary segments: Oilfield Services & Equipment...

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Investment thesis

Bull case

  • Strong operating cash flow of 3.81B provides robust 0.63x coverage of total debt 6.09B, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 3.71B provide 5.39x coverage of short-term debt 689M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 30.72B provides 5.05x coverage of total debt 6.09B, indicating robust asset backing and low credit risk.
  • Operating cash flow of 3.81B provides exceptional 105.83x coverage of minority interest expenses 36M, showing strong core operations.
  • Operating cash flow of 3.81B provides exceptional 17.16x coverage of interest expenses 222M, showing strong debt service capability.

Bear case

  • Operating cash flow of 3.81B barely covers its investment activities of (2.04B), with a coverage ratio of -1.86, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 3.81B provides thin coverage of dividend payments of (910M) with a -4.19 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Investment activities of (2.04B) provide weak support for R&D spending of 600M, which is -3.41x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 3.71B provide limited coverage of acquisition spending of (830M), which is -4.48x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of 3.81B provides insufficient coverage of deferred revenue obligations of 5.90B, which is 0.65x, raising concerns about future service delivery capabilities.

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer comparison

Companies in the Oil & Gas Equipment & Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SLB Slb Limited/Nv 59.56 Bn 20.77 2.67 11.64 Bn
2 BKR Baker Hughes Co 59.13 Bn 22.85 2.13 6.09 Bn
3 FTI TechnipFMC plc 28.99 Bn 127.65 1.96 1.34 Bn
4 HAL Halliburton Co 28.83 Bn 22.47 1.30 8.13 Bn
5 WFRD Weatherford International plc 7.39 Bn 17.15 1.50 1.64 Bn
6 NOV NOV Inc. 7.09 Bn 48.90 0.81 2.34 Bn
7 VAL Valaris Ltd 6.32 Bn 15.83 2.61 1.09 Bn
8 KGS Kodiak Gas Services, Inc. 4.56 Bn 91.00 3.58 2.66 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.53 1.17
EV to Cash from Ops. EV/CFO 16.40 -3.30
EV to Debt EV to Debt 10.27 10.99
EV to EBIT EV/EBIT 20.40 4.49
EV to EBITDA EV/EBITDA 14.58 6.54
EV to Free Cash Flow [EV/FCF] EV/FCF 22.87 31.31
EV to Market Cap EV to Market Cap 1.06 1.36
EV to Revenue EV/Rev 2.25 2.02
Price to Book Value [P/B] P/B 3.14 1.73
Price to Earnings [P/E] P/E 22.85 20.20
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 2.84 0.42
Dividend Payout Ratio % Div Payout % (Qtr) 35.10 5.49
Dividend per Basic Share Div per Share (Qtr) 0.92 0.26
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 33.22 6.68
Interest Coverage Int. cover (Qtr) 13.80 -10.19
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -0.28 -37.90
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 10.43 1,334.16
Dividend Growth (1y) % Div 1y % (Qtr) 9.52 4.06
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -11.74 -12.71
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -6.78 19.66
EBIT Growth (1y) % EBIT 1y % (Qtr) -10.80 -26.68
EBT Growth (1y) % EBT 1y % (Qtr) -12.21 39.97
EPS Growth (1y) % EPS 1y % (Qtr) -12.67 27.30
FCF Growth (1y) % FCF 1y % (Qtr) 21.05 -867.31
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 0.94 5.49
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.68 0.74
Cash Payout Ratio Cash Payout (Qtr) 0.19 0.10
Cash Ratio Cash Ratio (Qtr) 0.27 0.62
Current Ratio Curr Ratio (Qtr) 1.36 2.25
Debt to Equity Ratio Debt/Equity (Qtr) 0.32 0.88
Interest Cover Ratio Int Coverage (Qtr) 13.80 -10.19
Times Interest Earned Times Interest Earned (Qtr) 13.80 -10.19
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 15.30 16.47
EBIT Margin % EBIT Margin % (Qtr) 11.04 -0.62
EBT Margin % EBT Margin % (Qtr) 10.24 4.39
Gross Margin % Gross Margin % (Qtr) 23.60 30.41
Net Profit Margin % Net Margin % (Qtr) 9.30 2.67