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    Baker Hughes Company

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 45.73

    Market price

    USD 53.05

    Implied upside

    -13.8%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Value Per Share

    Perpetuity growth
    USD 45.73-13.8%
    Exit multiple
    USD 58.27+9.8%
    Market price
    USD 53.05

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn2bn4bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 29.6bnUSD 32.6bnUSD 35.7bnUSD 38.6bnUSD 41.4bnUSD 44.0bnUSD 46.4bnUSD 48.5bnUSD 50.1bnUSD 51.4bn+6.3%
    EBITUSD 3.3bnUSD 3.6bnUSD 3.9bnUSD 4.3bnUSD 4.6bnUSD 4.9bnUSD 5.1bnUSD 5.4bnUSD 5.5bnUSD 5.7bn+6.3%
    NOPATUSD 2.7bnUSD 3.0bnUSD 3.3bnUSD 3.5bnUSD 3.8bnUSD 4.0bnUSD 4.2bnUSD 4.4bnUSD 4.6bnUSD 4.7bn+6.3%
    Add depreciation & amortisationUSD 1.3bnUSD 1.4bnUSD 1.6bnUSD 1.7bnUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.2bnUSD 2.3bn+6.3%
    Less capital expenditureUSD -1.4bnUSD -1.6bnUSD -1.7bnUSD -1.9bnUSD -2.1bnUSD -2.3bnUSD -2.5bnUSD -2.6bnUSD -2.8bnUSD -2.9bn+8.7%
    Capex, % of revenue4.7%4.8%4.9%5.0%5.1%5.2%5.4%5.5%5.6%5.7%-
    Less increase in working capitalUSD -458.0mUSD -727.3mUSD -725.7mUSD -710.1mUSD -679.4mUSD -633.1mUSD -571.3mUSD -494.6mUSD -404.4mUSD -302.3m-4.5%
    Free cashflow to firmUSD 2.2bnUSD 2.1bnUSD 2.4bnUSD 2.6bnUSD 2.8bnUSD 3.0bnUSD 3.2bnUSD 3.4bnUSD 3.6bnUSD 3.7bn+6.2%
    Discount factor0.95880.88140.81030.74490.68480.62950.57870.53200.48900.4496-
    Present valueUSD 2.1bnUSD 1.9bnUSD 1.9bnUSD 1.9bnUSD 1.9bnUSD 1.9bnUSD 1.9bnUSD 1.8bnUSD 1.8bnUSD 1.7bn-
    Present Value Of The ForecastUSD 18.8bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.039Reported 1.058, pulled toward 1.0 (Blume)
    Cost of equity9.29%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 16.0x interest cover. Book interest / average debt was lower, at 3.7%.
    Market capitalisationUSD 52.7bn89.6% of capital
    Total debtUSD 6.1bn10.4% of capital, book value as a proxy
    Tax rate17.3%Effective, capped at statutory
    WACC8.78%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 45.73

    61% of EV

    Forecast FCFF, final year
    USD 3.7bn
    Capex at depreciation, working capital in reinvestment
    USD 5.1bn
    Less reinvestment at g/ROIC (22.7% of NOPAT)
    USD -1.2bn
    Capitalised
    USD 4.0bn
    ROIC (reported)
    11.0%
    Terminal value, undiscounted
    USD 64.6bn
    Terminal value, discounted
    USD 29.0bn
    Enterprise value
    USD 47.8bn
    Less net debt
    USD 2.4bn
    Equity value
    USD 45.5bn

    Exit at 11.6x EBITDA

    Value per shareUSD 58.27

    69% of EV

    Terminal value, undiscounted
    USD 92.3bn
    Terminal value, discounted
    USD 41.5bn
    Enterprise value
    USD 60.3bn
    Less net debt
    USD 2.4bn
    Equity value
    USD 57.9bn

    Spread between methods: 24%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.78%65.5467.2469.4672.4276.44
    7.78%53.9554.5355.3356.4057.83
    8.78%45.5945.6245.7445.9546.30
    9.78%39.3039.0438.8138.6138.45
    10.78%34.3933.9933.5833.1832.78

    Outlined: this model. Green text: above today's price of 53.05. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year9.4%6.4%8.3%
    EBIT margin12.8%11.1%12.7%
    Discount rate-8.8%8.0%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.