Halliburton, Superior Well Rise as Macquarie Ups to Buy

By Tiernan Ray
source:barrons.com
Shares of Halliburton (HAL) are up 9 cents at $26.43, after Macquarie Securities analyst Waqar Syed raised his rating on the stock to “Outperform” from “Neutral,” along with shares of Superior Well Services (SWSI), another energy services firm.

SWSI is up 44 cents, or 2.7%, at $16.79, clearly enjoying a bigger bounce from this upgrade.

Syed raised his price target on HAL to $40 from $36, and to $25 from $20 for SWSI

The key point is demand is outstripping supply for the kinds of “pressure pumping” that HAL and Superior offer to oil and gas exploration firms. “effective pressure pumping utilization is now 100%, and in some regions, equipment is working 24/7.”

“Utilization conditions are fast approaching the very frothy 2006 tightness levels, although pricing is still well below,” writes Syed.

Clients are now being wait-listed for work by Halliburton and Superior, writes Syed, by as much as four months.