UPDATE: J.P. Morgan Reiterates Neutral Rating, Raises PT on Halliburton Company

In a report published Monday, J.P. Morgan reiterated its Neutral rating on Halliburton Company

, and raised its price target from $42.00 to $45.00. J.P. Morgan noted, “Halliburton reported $0.63 EPS vs. JPM/cons $0.60/$0.61 but was closer to $0.66 when excluding higher taxes (34% vs. our 31% target) driven by stronger-than-usual int'l year-end product sales. More importantly, HAL called the bottom on US land margins (we had NA margins bottoming in 1Q13), which have plagued large caps following a precipitous decline in natgas activity and resulting frac equipment overcapacity. However, we don't believe we're out of the woods quite yet as they didn't call the bottom in the market, only their cost structure. HAL benefits from the reversing of 600-650bp margin loss (about 400bp more than peers) from a large inventory of high-priced guar, which HAL now expects to reach market rate by 2Q13. Excluding guar, we expect HAL's NA margins to remain compressed by frac pricing and utilization pressures (assuming no sharp recovery in gas activity).” Halliburton Company closed on Friday at $39.72.