HAL
Halliburton Company
$32.13
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Moderate
·
Conviction
Overvalued
Trading 17.8% above fair value
You pay
$32.13
Bear
$12.14
Fair
$27.27
Bull
$46.31
Bear
$12.14
-62.2%
FCF $1296M × 10x
Fair
$27.27
-15.1%
FCF $1672M × 13x
Bull
$46.31
+44.1%
FCF $2048M × 16x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
19.6x
Summary
Our base-case estimate uses a valuation based on free cash flow under different commodity price assumptions and a valuation multiple. We then blend that result with the average analyst price target of $42.78 from 64 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $27.27 per share.
Warnings
If oil drops to $60/barrel, the stock could fall -74%. Check whether the company can survive at low prices and still pay its dividend.
Where you think oil prices will settle long-term drives over 80% of this valuation. The biggest risk isn't the company itself — it's getting the commodity price wrong.
Wall Street's average price target is $42.78 (from 64 analysts). Our estimate is 56% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — commodity volumes do not compound
- Geopolitical premiums are real but historically temporary
- Reserve replacement ratio below 100% for 3 years is existential