Baker Hughes Company Fundamental Analysis (NASDAQ: BKR)
Baker Hughes Company Fundamental Analysis (NASDAQ: BKR)
Baker Hughes Company (NASDAQ: BKR) shows moderate financial fundamentals with a PE ratio of 20.57, profit margin of 11.17%, and ROE of 16.25%. The company generates $27.8B in annual revenue with weak year-over-year growth of -0.34%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 50.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze BKR's fundamental strength across five key dimensions:
Efficiency Score
WeakBKR struggles to generate sufficient returns from assets.
Valuation Score
ModerateBKR shows balanced valuation metrics.
Growth Score
WeakBKR faces weak or negative growth trends.
Financial Health Score
ExcellentBKR maintains a strong and stable balance sheet.
Profitability Score
ModerateBKR maintains healthy but balanced margins.
Key Financial Metrics
Is BKR Expensive or Cheap?
P/E Ratio
BKR trades at 20.57 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, BKR's PEG of 10.56 indicates potential overvaluation.
Price to Book
The market values Baker Hughes Company at 3.22 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 13.40 times EBITDA. This signals the market has high growth expectations.
How Well Does BKR Make Money?
Net Profit Margin
For every $100 in sales, Baker Hughes Company keeps $11.17 as profit after all expenses.
Operating Margin
Core operations generate 12.92 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $16.25 in profit for every $100 of shareholder equity.
ROA
Baker Hughes Company generates $5.89 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Baker Hughes Company produces operating cash flow of $4.44B, showing steady but balanced cash generation.
Free Cash Flow
Baker Hughes Company generates strong free cash flow of $3.13B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $3.16 in free cash annually.
FCF Yield
BKR converts 4.87% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
20.57
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
10.56
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.22
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.31
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.82
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.09
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.16
vs 25 benchmark
ROA
Return on assets percentage
0.06
vs 25 benchmark
ROCE
Return on capital employed
0.09
vs 25 benchmark
How BKR Stacks Against Its Sector Peers
| Metric | BKR Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 20.57 | 21.54 | Neutral |
| ROE | 16.25% | 1255.00% | Weak |
| Net Margin | 11.17% | 1263.00% | Weak |
| Debt/Equity | 0.82 | -1.82 (disorted) | Distorted |
| Current Ratio | 2.09 | 2.24 | Strong Liquidity |
| ROA | 5.89% | 4414.00% | Weak |
BKR outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Baker Hughes Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-8.49%
Industry Style: Cyclical, Value, Commodity
DecliningEPS CAGR
117.79%
Industry Style: Cyclical, Value, Commodity
High GrowthFCF CAGR
99.62%
Industry Style: Cyclical, Value, Commodity
High Growth