Analyst Note| Preston Caldwell |
Halliburton's third-quarter revenue increased 4% sequentially, driven by higher pricing and activity. Adjusted operating margins increased 20 basis points to 11.9%, representing incrementals of 16%, slightly below the rate seen so far during the pandemic recovery. This was partly due to cost pressures, although management also noted that the Completion & Production segment added higher costs to prepare for higher activity in coming quarters. Our fair value estimate and narrow moat rating are unchanged following the results.