We recently released a list According to analysts, 12 best refinery stocks can be invested. In this article, we will explore the position of Baker Hughes Corporation (NASDAQ:BKR) with other best refinery stocks representing investments.
The United States is The world’s largest oil producer As current production reaches record levels, it is also calculated in The country with the largest refining capacity. There are 132 refineries in the United States, with a total capacity of 18.4 million barrels per day (BPD) in early 2024, a 2% increase compared to early 2023.
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2024 has been a tough year for the global refining industry as industry players face multi-year lows in soft consumers and industrial demand (especially in China), slowing economic growth and increasing Energy transition and expands global refining capacity. The decline in fuel margins in the fourth quarter of 2024 led to disappointing revenue results for many refineries as large amounts of new output compete with stagnant demand. This led to several oil specialists closing operations and selling their refineries, but it wasn’t as smooth as expected.
This does not seem to have gotten better as the IEA’s recent market outlook, as the energy transition advances, global growth in oil demand is expected to slow down, as the IEA’s oil demand growth will slow. The U.S. Energy Information Administration pointed out last month that it expects Brent crude oil prices to average $74 a barrel in 2025, then dropping to $66 a barrel in 2026, further reducing refinery profit margins.
Furthermore, although President Donald Trump’s tariffs on imports from Mexico and Canada could make things worse for the refining sector. Many refineries in the Midwest depend on Canadian crude oil, and the upcoming 10% tariff will force them to pay more for feedstocks or cut production, further squeezing an already declining industry. The president wants to make the U.S. self-sufficient and independent in terms of energy, but no matter how much oil the U.S. pumps, its refineries aim to deal with darker, denser, cheaper crude oil that is hard to find at home. But Trump’s plan to return support for electric cars and charging stations could slow down its sales and boost gasoline demand, thus giving the industry some breath.
The rapid energy transition is also a major reason for the refining sector to focus on as the government pushes drivers toward climate goals. Therefore, the only way forward is to adapt and develop the industry. Now, some forward-looking refineries improve their resilience by upgrading their facilities to produce high-value but low-carbon products such as petrochemical and renewable fuels, although it requires substantial capital investment.
There has been a lot of fluctuations in the energy sector over the past few months, with a surge of more than 6% in November and then a decline of about 10% in December. However, the broader energy sector ended last year with a return of only 5.72%, which lagged significantly behind the wider market by 25%. However, the industry has remained strong over the past 3 and 5 years.
To collect the data for this article, we examined all companies in all refining sectors listed on the Nasdaq and the New York Stock Exchange, and then compiled the highest upside potential based on Wall Street analysts (as of February 18, 2024). Stock list.
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Is Baker Hughes Corporation (BKR) the best refinery stock in stock, according to analysts?
Drilling was carried out on a remote oil field, and its tower walls surrounded the sunset.
Inventory upward potential: 13.84%
Baker Hughes Corporation (NASDAQ:BKR) is an energy technology company that provides solutions to global energy and industrial customers. The company is also involved in the petroleum refining business through an integrated suite of high-performance equipment, chemicals, real-time data technologies and services.
Baker Hughes Corporation (NASDAQ:BKR) performed well in Q4 2024 as its adjusted EPS maintained an impressive growth trajectory, up 37% from Q4 2023 for the full year Increased by 47%. The company’s revenue also rose 7.7% to $7.364 billion, exceeding the consensus estimate of $293 million. Additionally, BKR terminated its total orders for 2024 at $28.2 billion, including $13 billion in IET orders, marking the second highest order in the segment.
Baker Hughes Corporation (NASDAQ:BKR) maintains a strong balance sheet and generates strong free cash flow of $894 million in the fourth quarter of 2024, resulting in a record annual free cash flow of $2.3 billion Dollar. The company remains committed to returning 60% to 80% of its free cash flow to shareholders and distributed $1.3 billion in dividends and share buybacks last year, accounting for about 60% of its cash flow. BKR raised its quarterly dividend by 10% last month to $0.23 per share, marking its fourth straight year of dividend increase, up 28% since the third quarter of 2022.
Last year, Baker Hughes (NASDAQ:BKR) shares soared more than 61% Buy 12 hot oil stocks based on hedge funds.
Overall, BKR Ranked sixth According to analysts, on our list of best refinery stocks. Although we acknowledge the potential for BKR to grow, our belief lies in the belief that certain AI stocks offer higher returns in a shorter time frame and achieve this in a shorter time frame. If you are looking for AI stocks that are more promising than BKR but have less than 5 times its earnings, check out our report Cheapest AI stocks.
Read the next article: Buy 20 Best AI Stocks Now and A full list of 59 AI companies with less than $2 billion in market value
Disclosure: None. This article was originally published in Internal monkey.
