NEW YORK (TheStreet) -- Halliburton (HAL) - Get Report stock is falling 0.48% to $39.12 in midday trading on Friday as the company seeks to gain European Union approval for the $35 billion acquisition of Baker Hughes (BHI), Reuters reports.
The oilfield service provider refiled a request seeking antitrust approval after EU regulators rejected the bid four months ago because not enough information was provided.
Halliburton has offered to sell three drilling businesses in Mexico and an expandable liner hangers division to gain approval. The company is also ready to sell three Baker Hughes units, Reuters added.
The European Commission will either approve the deal or open an investigation by Jan. 12.
Halliburton stock is also being pressured by oil prices that are down because of a stronger dollar and weak Chinese economic data, Reuters noted.
WTI crude is declining 2.58% to $41.93 per barrel, while Brent crude is falling 1.01% to $45 per barrel this afternoon, according to the CNBC.com index.
Separately, TheStreet Ratings team rates HALLIBURTON CO as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
We rate HALLIBURTON CO (HAL) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- HAL, with its decline in revenue, slightly underperformed the industry average of 30.8%. Since the same quarter one year prior, revenues fell by 35.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Despite currently having a low debt-to-equity ratio of 0.51, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.42 is sturdy.
- HALLIBURTON CO has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, HALLIBURTON CO increased its bottom line by earning $4.03 versus $2.37 in the prior year. For the next year, the market is expecting a contraction of 63.1% in earnings ($1.49 versus $4.03).
- The gross profit margin for HALLIBURTON CO is rather low; currently it is at 17.20%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -0.96% trails that of the industry average.
- Net operating cash flow has significantly decreased to $26.00 million or 96.89% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full analysis from the report here: HAL
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.