JPMorgan analysts reiterated an Overweight rating and $35 price target for Baker Hughes Company (NASDAQ:BKR) shares, stating the firm sees a solid second quarter print.
The analysts told investors in a research note that fears about the heightened third quarter seasonality appear to be overblown.
"We anticipate a solid operational print from BKR, with our 2Q23 EPS and EBITDA estimates of $0.34 and $878mm sitting just above the STe of $0.33 and $878mm," the analysts wrote. "We anticipate solid operational momentum to translate into robust FCF of $350mm for the quarter."
JPMorgan believes Baker Hughes is well-positioned to hit its key operational targets for 2023, with strength in IET and offshore and international markets in OFSE "poised to offset softening conditions" in North America.
"Looking ahead, we expect the strength in IET to lead to less (not more) seasonality in 3Q and 4Q as revenues should be more level loaded relative to typical seasonal patterns," added the analysts. "As such, we have confidence in our 3Q and 4Q EBITDA estimates of $968mm and $1,111mm, which are consistent with Street expectations of $968mm and $1,133mm, respectively."