Baker Hughes upgraded to "buy"

04/23/03 - Prudential Securities

NEW YORK, April 23 (New Ratings) — Analyst Grant Borbridge of Prudential Financial upgrades Baker Hughes (BHI: NYSE) from "hold" to "buy." The target price has been raised from $30 to $32.

Shares of Baker Hughes, an oilfield services company, are currently trading at $28.33.

According to Prudential Financial's research note, Baker Hughes has reported its 1Q03 results in-line with expectations. The analyst considers the recent weakness in the company's stock an exaggerated reaction to the pre-announcement of 1Q earnings by the company. Improving market trends are, however, expected to significantly boost the company's earnings growth through the remaining quarters of 2003, adds the analyst.

Prudential Financial believes that the company's stock offers substantial upside potential from the current valuation, given the robust earnings and cash flow expectations for 2003. The analyst considers the company's stock attractively valued at present.

The EPS and P/E estimates for 2003 are $0.97 and 29.2x, respectively.

Prudential Financial upgrades Baker Hughes from "hold" to "sell."