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Investing.com - Melius Research initiated coverage on Baker Hughes (NASDAQ:BKR), the $42.2 billion energy technology company, with a Buy rating and a price target of $60.00 on Wednesday. The target aligns with the broader analyst consensus, as InvestingPro data shows 12 analysts have recently revised their earnings estimates upward.
The research firm highlighted Baker Hughes’ transformation into a global energy and industrial technology company with operations spanning more than 120 countries and expertise in oil services and industrial and energy technology. According to InvestingPro analysis, the company maintains strong financial health with a 21.4% gross profit margin and has consistently paid dividends for 39 consecutive years.
Melius noted that Baker Hughes maintains a dedicated climate portfolio and has established a strong artificial intelligence partnership with C3.ai (NYSE:AI), positioning the company at the intersection of energy and technology.
The firm specifically mentioned Baker Hughes’ recently announced acquisition of Chart Industries (NYSE:GTLS), which it believes will strengthen the company’s position in industrial and energy technologies, particularly in natural gas.
Melius expressed confidence in natural gas as a key energy source, stating it "will be a key energy source for at least the next several decades if not longer."
In other recent news, Baker Hughes has completed its $540 million acquisition of Continental Disc Corporation, enhancing its flow control market presence. The company expects this acquisition to be immediately accretive to earnings, cash flow per share, and margins in its Industrial & Energy Technology segment. Additionally, Baker Hughes announced a significant $13.6 billion acquisition of Chart Industries, which has prompted Piper Sandler to reiterate an Overweight rating with a $50 price target. This acquisition is seen as a strategic move to expand Baker Hughes’ capabilities in gas and liquid molecule handling technologies.
BMO Capital has also increased its price target for Baker Hughes to $53, maintaining an Outperform rating, citing the expansion and complementing of the company’s Industrial Energy & Technology segment due to the Chart acquisition. UBS raised its price target to $46, maintaining a Neutral rating, viewing the GTLS deal positively as it aligns with Baker Hughes’ strategic focus on higher-margin life-cycle based revenues. Meanwhile, BofA Securities has adjusted its price target to $190, attributing the increase to traffic growth driven by effective advertising and menu innovations at Chili’s. These developments reflect a period of strategic growth and expansion for Baker Hughes, with analysts showing varied levels of optimism regarding its future performance.
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