Investors looking for an example of how short-term thinking dominates the equity markets these days do not have to go much past the energy sector. There are still plenty of arguments over what “Peak Oil” is supposed to mean, but hardly anybody thinks that long-term oil and natural gas prices are going to substantially lower than today. And yet, nervousness about the near-term economic outlook and short-term oil price declines as investors leery of even well-established service names like Halliburton (HAL).
Okay Results Fail To Impress
This is a market that wants dramatic outperformance and strong upward revisions from management, and Halliburton didn't deliver. Consequently, the fact that revenue was up about 10% sequentially and still a bit stronger that the average analyst guess just isn't going to cut it – particularly when management talked about an increasingly competitive international pricing environment and delays in key growth markets like Iraq and Angola.
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Waiting For Halliburton To Wash Out
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