Baker Hughes Earnings: Management Slightly Raises 2023 Guidance; Several Years of Growth Ahead

Baker Hughes delivered another strong performance in the third quarter, with significant contributions from its industrial energy technologies, or IET, segment as LNG contracting activity continues accelerating around the world. The firm slightly raised guidance for fiscal 2023, with the midpoint for revenue and adjusted EBITDA both increasing about 1% compared to last quarter’s outlook. The firm is now on track to deliver more nearly $25.7 billion in sales for 2023, a 21% year-over-year increase, while lifting its adjusted EBITDA margin by about 50 basis points to 14.6%. We’re slightly raising our fair value estimate to $35 following results, and we maintain our no-moat rating.