Baker Hughes rose about 2 percent today, its latest step in a month-long run that has pushed the stock to a new high. We think this is mostly a mix of rising oil prices and continued confidence in the record $37 billion order backlog the company reported last week.
Our view
The record backlog of orders for gas and data center power equipment shows this is now a technology business, not just a drilling services firm. If you already own it, there is nothing to do here but sit tight and let those long-term contracts play out.
The company won a major order to supply gas turbines and generators to Dynamis Power Solutions. These units provide on-site electricity for data centers and oilfield operations, which are increasingly looking for ways to generate their own power rather than relying on the traditional electrical grid.
This deal shows the company is successfully finding new customers outside of traditional oil and gas. As data centers require massive amounts of electricity for AI, the company is using its existing turbine technology to capture a piece of that growing market.
UBS maintained its neutral rating and set a price target of $51. This is notably lower than the current stock price and the average analyst target of about $72. The firm appears more cautious than its peers about how much the stock can rise from here.
The company warned that oil and gas producers will likely spend a little less on drilling and equipment this year. While activity is growing in North America and Latin America, it is being offset by lower spending in the Middle East and Europe.
This is a reminder that while the company is shifting toward new energy technology, a large part of its business still depends on the budgets of big oil companies. If those companies pull back on spending to save cash, it could slow down the growth of the company's traditional services arm.
The company secured a major contract to provide the cooling and processing equipment for Venture Global's CP2 project. This is a large-scale facility designed to turn natural gas into a liquid so it can be shipped across the ocean.
Winning these types of contracts is a core part of the company's strategy. These are massive, multi-year projects that lock in high-margin equipment sales and decades of future maintenance work, helping to insulate the business from short-term swings in oil prices.
The company will pay a quarterly dividend of $0.23 per share on August 17. To receive the payment, you must own the stock by the end of the day on August 7. This is a routine payment and is consistent with management's plan to return a large portion of cash to shareholders.
Analysts adjusted their price targets for Baker Hughes following the company's strong second-quarter earnings report in late July. Most analysts remain positive, with 30 of 45 rating the stock a buy and an average target price suggesting 14% upside.
Average target$71.82+14%vs $62.75 today
TodayAvg price
Low $51High $80
Buy45 analysts
1Bearish
14Neutral
30Bullish
FirmRatingPrice TargetDate
Morgan Stanley
Overweight
$70
8/7/2026
UBS
Neutral
$51
7/28/2026
UBS
Neutral
$73→$71
7/28/2026
Susquehanna
Positive
$70→$72
7/28/2026
Stifel Nicolaus
Buy
$74→$75
7/28/2026
Piper Sandler
Overweight
$71→$73
7/28/2026
Barclays
Equal Weight
$74→$72
7/16/2026
Piper Sandler
Overweight
$72→$71
7/14/2026
Wolfe Research
Outperform
$70
7/8/2026
Susquehanna
Positive
$80→$70
7/8/2026
Barclays
Equal Weight
$74
5/7/2026
Susquehanna
Positive
$70→$80
4/27/2026
Baker Hughes earnings
The company has beaten profit expectations for eight straight quarters. Management has a clear habit of setting a bar they can reliably clear, which makes their forecasts easier to trust.
Earnings history
EstimateBeatMiss
Baker Hughes past earnings results
Expected
Actual
Surprise
EPS
$0.51
$0.64
+25.2%
Revenue
$6.54B
$6.74B
+3.1%
Key highlights
Industrial technology orders surge: The Industrial Energy Technology segment saw its bookings double to $7.1 billion compared to a year ago, driven by massive demand for power generation and data center equipment. This push for energy security led the company to raise its total expected orders for this division to more than $45 billion for the three years ending in 2028.
Backlog reaches record levels: Total remaining performance obligations, which is the value of work the company has contracted but not yet finished, grew to $40.1 billion from $33.1 billion at the end of 2024. This record high gives the company more predictable work for its factories over the next several years.
Industrial profit margins expand: Profit margins in the industrial technology division rose to 20.6% from 17.8% a year ago, thanks to higher prices and more efficient manufacturing. This improvement is important because it shows the company can make more money on each sale even as it deals with higher inflation costs.
Strong cash generation: The company generated $1.1 billion in free cash flow this quarter, a significant jump from the $239 million it produced during the same period last year. This cash gives the company the flexibility to pay for its recent acquisition of Chart Industries and return money to shareholders through its $0.23 per share dividend.
Oilfield business stays resilient: Revenue in the oilfield services segment fell 5% to $3.45 billion compared to last year, mostly because the company sold off its surface pressure control business. Even with that sale and disruptions in the Middle East, the division still earned $605 million in operating profit because of strong activity in Latin America.
Full year profit outlook: Management expects to hit the middle of its previously stated financial targets for the full year 2026, even with ongoing uncertainty in Middle East markets. Reaching these targets would mean the company successfully navigated a complex global environment while integrating its new acquisitions.
Our take: Baker Hughes delivered a very strong quarter, as record orders for power and gas equipment more than made up for a slightly smaller oilfield business. This shift toward industrial technology is making the company more profitable and less dependent on oil prices, which strengthens the long-term case for the stock.
Baker Hughes’s next earnings date
Q3 2026
OCT
22
Expectation
EPS
$0.58
Revenue
$7.17B
AUG
7
Dividend payday
Own the stock before this date to get the next dividend payment.
Metrics we are tracking
Metric
Expectations
Status
Total Backlog
Growing above $32B with a high book-to-bill ratio
$40.1B in Q2 2026
IET Operating Margin
Consistent progress toward the 20% long-term target
