Analyst Note
| Preston Caldwell |As anticipated, Halliburton experienced a small bump downward in first-quarter results, owing chiefly to the usual seasonality. Although revenue was flat, operating margins fell 0.5% sequentially, driven by a 2% margin drop in the completion and production segment. The flat revenue was the result of higher activity in North America, offset by a seasonal dip in activity in international markets. The margin decline was driven by product mix as well as operational disruption in the first quarter (such as sand shortages in North America). Our fair value estimate and narrow moat rating are unchanged following the results.