UPDATE: Citigroup Raises PT on Baker Hughes Following Disappointing 2Q Earnings

In a report published Monday, Citigroup analyst Robin Shoemaker reiterated a Neutral rating on Baker Hughes BHI, and raised the price target from $46.00 to $48.00.

In the report, Citigroup noted, “BHI came in below expectations (adjusted EPS of $0.61 vs. our $0.63 estimate and the $0.65 consensus) due to a contract extension that went awry in Brazil, and we are reiterating our Neutral rating. BHI reported on a day that Schlumberger reported strong international earnings (including Latin America). For good reasons investors sold BHI and bought SLB. BHI made a decision to keep resources in Brazil that delayed its transition to a reduced presence following the loss of a major drilling services contract late last year. A contract extension was not granted as BHI expected, and the company was therefore unable to demobilize in an orderly fashion. The number of deepwater rigs employing BHI services fell rapidly in 2Q13, and its remaining business in Brazil shifted to lower-margin onshore activities.”

Baker Hughes closed on Friday at $47.80.