The Peer the Promo Skips
Rob Spivey’s “The #1 Oil Income Play of 2026” teases Baker Hughes as the pick, but the more instructive exercise is to put it next to Halliburton (HAL), the second member of the Big Three in oilfield services. When you line the two up, you see quickly that the promo’s “income play” label and its valuation both need some explaining.
Halliburton is the purest services play of the group. Where Baker Hughes and Schlumberger have built out technology and equipment franchises, Halliburton’s identity is drilling, completion, and production work, the hands-on layer that keeps wells producing. That focus makes it the cleanest barometer of the global spending cycle.
The Numbers Side by Side
The most striking difference is the multiple. Halliburton trades around 13 times forward earnings, while Baker Hughes trades around 22 times and Schlumberger around 18 times, even though all three carry similar analyst growth forecasts. That is a wide gap for three companies in the same sector facing the same commodity environment.
The yield tells a similar story. Baker Hughes distributed about $910 million in 2025, roughly 1.5 percent on a nearly $59 billion market cap. Halliburton’s dividend, while not dramatically higher, is closer to what an income investor might actually want, and the company has a long record of returning cash through dividends and buybacks. If the pitch is about income, the cheaper, higher-yielding name deserves at least a look.
Why the Gap Exists
The valuation premium on Baker Hughes is not random. It reflects the company’s industrial and energy technology segment, the turbines and compressors that are now being ordered for AI-driven electricity generation. Halliburton has no equivalent franchise, so it does not get the AI power premium. That is a real difference in the business, not a market mistake.
The question is how much it is worth. Paying 22 times earnings for a name whose dividend yields 1.5 percent means you are buying the turbine story, not the dividend. If that story stalls, the premium can close fast, and Halliburton’s cheaper multiple becomes the more attractive risk-adjusted entry. Our oil dividend stocks piece walks through that yield-versus-growth trade-off.
What Moves Halliburton
Halliburton’s fate tracks the oilfield spending cycle, and right now that cycle is improving. The sector spent years underinvesting after the 2015 to 2020 downturn, and operators are now spending to maintain and grow production. The order momentum the promo cites for Baker Hughes, a 29 percent jump in the second quarter of 2026, is a tailwind that lifts the whole group, Halliburton included.
The difference is that Halliburton participates through pure services exposure, without the AI-power multiple baked in. For an investor who wants the recovery without paying the premium, that is the relevant comparison. We put the trio side by side in our oilfield services companies article.
The Dividend Comparison
The promo sells Baker Hughes as an income play, so it is fair to ask how the two companies actually compare on cash returned to shareholders. Baker Hughes distributed about $910 million in 2025, which is roughly 1.5 percent on a nearly $59 billion market cap, growing around 7 percent a year. Halliburton’s payout is more modest in absolute size, but on a cheaper multiple its yield is more competitive, and the company has a long history of returning cash through both dividends and share buybacks.
The point is not that Halliburton is a high-yield income stock. Neither of these names is a bond substitute. The point is that if the pitch is about income, the cheaper name with the comparable payout deserves at least as much attention as the one being sold. The “income” label in the promo is doing work the actual yields do not support.
What Would Close the Gap
If the AI power story cools, the valuation gap between the two names would likely narrow, and not in Baker Hughes’ favor. A 22-times multiple with a 1.5 percent yield leaves little cushion for a slowdown in turbine orders. Halliburton at 13 times, with a more focused services franchise, has less optimism priced in to begin with.
That does not make Halliburton the better company. It makes it the better setup if the cycle continues but the narrative premium fades. Investors who believe the turbine story is durable should own Baker Hughes; investors who want the recovery without the story should look harder at Halliburton.
The Bottom Line
Halliburton is the cheaper, more focused way to own the oilfield services recovery, and it is the natural check against the promo’s Baker Hughes pick. Neither is a secret; the choice comes down to whether you want to pay up for the turbine angle or buy the cycle at a discount.
Ready to see the research? Click here to access Rob Spivey’s report.
NewsletterVetter is an independent publication. We receive compensation from some of the services we review through affiliate links. Nothing on this site is investment advice. Always do your own research.