Baker Hughes Company (BKR)
Valuation Overview•Is Baker Hughes Company Overvalued or Undervalued?
Trading at a discount to intrinsic cash flow value, implying pessimistic long-term market expectations.
Moderate quality score of 62/100, reflecting stable operating margins and manageable leverage.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Solid fundamental quality, though growth presents a headwind.
Wall Street is highly bullish, projecting significant upside. This is paired with healthy capital returns, anchored by a strong, well-covered dividend yield.
BKR demonstrates adequate business quality with stable profitability. This is paired with a moderately leveraged but stable balance sheet.
The company demonstrates solid revenue growth (9.4% 3Y CAGR) paired with stable bottom-line earnings. This growth is supported by elite operational efficiency, sustaining an impressive 25.3% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $6.6B | -0.3% | +9.4% | +6.0% | +5.2% | |
| EBITDA | $809.0M | — | +17.2% | — | — | |
| Net Income | $930.0M | -13.1% | — | — | — | |
| EPS (Diluted) | $0.93 | -12.8% | — | — | — | |
| Free Cash Flow | $500.0M | +23.5% | +31.5% | +37.5% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 23.6% | 23.3% | 23.1% | 21.1% |
| Operating Margin | 25.3% | 11.8% | 10.1% | 6.3% |
| Net Margin | 11.2% | 9.2% | 4.7% | -2.1% |
| FCF Margin | 9.4% | 7.9% | 7.6% | 3.9% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.49 | $0.58 | +17.6% | ||
| Q1'26 | $0.67 | $0.78 | +16.8% | ||
| Q4'25 | $0.62 | $0.68 | +10.4% | ||
| Q3'25 | $0.56 | $0.63 | +13.5% | ||
| Q2'25 | $0.47 | $0.51 | +8.1% | ||
| Q1'25 | $0.62 | $0.70 | +12.2% | ||
| Q4'24 | $0.61 | $0.67 | +9.8% | ||
| Q3'24 | $0.49 | $0.57 | +16.3% |
Total return is +52.2% (1Y), outperforming the benchmark by +27.2%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +24.9% | +15.6% | — |
| 1Y | +52.2% | +27.2% | +2.4% |
| 3YCAGR | +27.0% | +8.6% | +8.8% |
| 5YCAGR | +22.5% | +9.3% | +18.0% |
| 10YCAGR | +10.0% | -3.6% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Baker Hughes Company (BKR) valuation, health, and returns.
Baker Hughes Company is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Fair versus peers compared to industry peers. undervalued (implying +67.6% upside to DCF intrinsic value of $97.90)
Baker Hughes Company has multiple valuation anchors: DCF Intrinsic Value: $97.90 | Peer Relative Fair Value: $54.39 | Wall Street Analyst Target: $73.20 (implying +25.3% upside). A convergence of these signals offers higher conviction.
Baker Hughes Company displays good financial health with a composite quality score of 62/100, supported by a Altman Z-Score of 2.4 (grey zone), Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of 12.7%.
Baker Hughes Company pays a 1.6% dividend yield, covered by a 35% payout ratio with 4 years of growth, supplemented by a 0.7% buyback yield.
Baker Hughes Company's current growth trajectory is Decelerating. The company achieved -0.3% 1Y revenue growth and -12.8% 1Y EPS growth, compared to its 3Y revenue CAGR of +9.4%.
Wall Street consensus is Buy based on 45 analysts, beating EPS expectations in 100% of recent quarters with a 13-quarter streak. The consensus price target represents a +25.3% change from current levels.
Investment risks for Baker Hughes Company include: -16.9% 1-year max drawdown. Volatility risk is characterized by a beta of 0.84x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.