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BKR, Baker Hughes Company

Oilfield Services & Equipment capital-intensive Cyclical

Baker Hughes Company is an energy technology company with a diversified portfolio of technologies and services that span the energy and industrial value chain.

Built on a century of experience and conducting business in over 120 countries, our innovative technologies and services are taking energy forward.

By integrating health, safety & environment ("HSE") into everything we do, we protect our people, our customers, and the environment.

Latest annual: FY2025 10-K

BKR · Baker Hughes Company

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$27.7B

−0.3% YoY · 6% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $27.9B 5-yr avg $24.5B

Gross margin 60%

Operating margin 11.0% 5-yr avg 8.5%

ROIC 13% 5-yr avg 9%

Owner-earnings margin 8% 5-yr avg 7%

Free cash flow margin 8% 5-yr avg 7%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is Oilfield Services and Equipment (52%) and Industrial and Energy Technology (48%).
Situation: Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Operating margin has run about 4.5% through the cycle, a thin margin, where volume, cost discipline and the price it gets all bear on the result. The margin is cyclical, swinging between −77% and 11% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. Inventory runs near 20% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on the capital-goods cycle and the aftermarket. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median 3%, above 15% in 0 of 10 years). By owner earnings: roughly 4% of revenue reaches owners as cash, though it swings. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Revenue spreads across 2 segments, the largest Oilfield Services And Equipment at 52%.

Revenue by reportable segment, FY2025

Oilfield Services And Equipment52%$14.3B
Industrial And Energy Technology48%$13.4B

By geographyInternational72%United States28%

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$13.1B	$17.2B	$22.9B	$23.8B	$20.7B	$20.5B	$21.2B	$25.5B	$27.8B	$27.7B	$27.9B	RevenueRevenue
40%	45%	—	—	—	—	—	—	—	—	60%	Gross marginGross mgn
15%	15%	12%	12%	12%	12%	12%	10%	9%	9%	9%	SG&A / revenueSG&A/rev
3%	3%	3%	3%	3%	2%	3%	3%	2%	2%	2%	R&D / revenueR&D/rev
$457M	($284M)	$701M	$1.1B	($16.0B)	$1.3B	$1.2B	$2.3B	$3.1B	$2.8B	$3.1B	Operating incomeOp. inc.
3.5%	−1.7%	3.1%	4.5%	−77.2%	6.4%	5.6%	9.1%	11.1%	10.2%	11.0%	Operating marginOp. mgn
$0	($103M)	$195M	$128M	($9.9B)	($219M)	($601M)	$1.9B	$3.0B	$2.6B	$3.1B	Net incomeNet inc.
—	—	57%	—	—	—	—	26%	8%	9%	12%	Effective tax rateTax rate
											Cash flow & returns
$262M	($799M)	$1.8B	$2.1B	$1.3B	$2.4B	$1.9B	$3.1B	$3.3B	$3.8B	$3.6B	Operating cash flowOp. cash
$550M	$1.1B	$1.5B	$1.4B	$1.3B	$1.1B	$1.1B	$1.1B	$1.1B	$1.2B	$1.3B	DepreciationDeprec.
($288M)	($1.8B)	$81M	$580M	$9.7B	$1.3B	$1.2B	($165M)	($985M)	($169M)	($970M)	Working capital & otherWC & other
$424M	$665M	$995M	$1.2B	$974M	$856M	$989M	$1.2B	$1.3B	$1.3B	$1.3B	CapexCapex
3.2%	3.9%	4.3%	5.2%	4.7%	4.2%	4.7%	4.8%	4.6%	4.6%	4.7%	Capex / revenueCapex/rev
($162M)	($1.5B)	$767M	$886M	$330M	$1.5B	$899M	$1.8B	$2.1B	$2.5B	$2.3B	Owner earningsOwner earn.
−1.2%	−8.5%	3.4%	3.7%	1.6%	7.4%	4.2%	7.2%	7.4%	9.1%	8.2%	Owner earnings marginOE mgn
($162M)	($1.5B)	$767M	$886M	$330M	$1.5B	$899M	$1.8B	$2.1B	$2.5B	$2.3B	Free cash flowFCF
−1.2%	−8.5%	3.4%	3.7%	1.6%	7.4%	4.2%	7.2%	7.4%	9.1%	8.2%	Free cash flow marginFCF mgn
$1M	$3.4B	$89M	$0	—	$87M	$767M	$301M	$0	$830M	$830M	AcquisitionsAcquis.
$0	$155M	$315M	$395M	$488M	$592M	$726M	$786M	$836M	$910M	$909M	Dividends paidDiv. paid
$0	$174M	$387M	$0	$0	$434M	$828M	$538M	$484M	$384M	—	BuybacksBuybacks
2%	-1%	2%	2%	-77%	4%	5%	9%	15%	12%	13%	ROICROIC
0%	-1%	1%	1%	-77%	-1%	-4%	13%	18%	14%	16%	Return on equityROE
0%	−2%	−1%	−1%	−81%	−5%	−9%	8%	13%	9%	11%	Retained to equityRetained/eq
											Balance sheet
$981M	$7.0B	$3.7B	$3.2B	$4.1B	$3.9B	$2.5B	$2.6B	$3.4B	$3.7B	$14.8B	Cash & investmentsCash+inv
$2.6B	$6.0B	$6.0B	$6.4B	$5.6B	$5.7B	$6.0B	$7.1B	$7.1B	$6.6B	$6.7B	ReceivablesReceiv.
$3.2B	$4.5B	$4.6B	$4.6B	$4.4B	$4.0B	$4.6B	$5.1B	$5.0B	$5.0B	$4.9B	InventoryInvent.
$1.9B	$3.4B	$4.0B	$4.3B	$3.5B	$3.7B	$4.3B	$4.5B	$4.5B	$4.6B	$4.3B	Accounts payablePayables
$3.9B	$7.1B	$6.6B	$6.8B	$6.5B	$5.9B	$6.2B	$7.7B	$7.5B	$7.0B	$7.3B	Operating working capitalOper. WC
$7.4B	$18.4B	$15.0B	$15.2B	$16.5B	$15.1B	$14.6B	$16.3B	$17.2B	$18.8B	$28.6B	Current assetsCur. assets
$4.9B	$9.2B	$9.0B	$10.0B	$10.2B	$9.1B	$11.1B	$13.0B	$13.0B	$13.9B	$13.4B	Current liabilitiesCur. liab.
1.5×	2.0×	1.7×	1.5×	1.6×	1.7×	1.3×	1.3×	1.3×	1.4×	2.1×	Current ratioCurr. ratio
$6.7B	$19.9B	$20.7B	$20.7B	$6.0B	$6.0B	$5.9B	$6.1B	$6.1B	$6.1B	$6.0B	GoodwillGoodwill
$21.7B	$56.5B	$52.4B	$53.4B	$38.0B	$35.3B	$34.2B	$36.9B	$38.4B	$40.9B	$50.9B	Total assetsAssets
$277M	$8.3B	$7.2B	$6.6B	$7.6B	$6.7B	$6.7B	$6.0B	$6.0B	$6.1B	$16.2B	Total debtDebt
($704M)	$1.3B	$3.5B	$3.4B	$3.5B	$2.9B	$4.2B	$3.4B	$2.7B	$2.4B	$1.4B	Net debt / (cash)Net debt
$14.7B	$14.3B	$17.5B	$21.9B	$12.9B	$14.8B	$14.4B	$15.4B	$16.9B	$18.8B	$19.3B	Shareholders’ equityEquity
—	—	—	—	1.0%	1.0%	1.0%	0.8%	0.7%	0.7%	0.7%	Stock comp / revenueSBC/rev

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

ROIC

12%low FY2020

Net debt ÷ owner earnings

0.9×peak FY2020

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$2.5Bowner earningsvs.$2.6Bnet incomelow FY2017

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business reported $2.6B of profit but $2.5B of owner earnings: $51M less than the profit line, taken out by capital spending and the timing of cash.

Reported net income$2.6B

Owner earnings$2.5B · 9% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$2.6B	$3.0B	$1.9B	($601M)	($219M)
Depreciation & amortizationnon-cash charge added back	+$1.2B	+$1.1B	+$1.1B	+$1.1B	+$1.1B
Stock-based compensationreal costnon-cash, but a real cost	+$203M	+$202M	+$197M	+$207M	+$205M
Working capital & othertiming of cash in and out, other non-cash items	−$169M	−$985M	−$165M	+$1.2B	+$1.3B
Cash from operations	$3.8B	$3.3B	$3.1B	$1.9B	$2.4B
Capital expenditurecash put back in to keep running and to grow	−$1.3B	−$1.3B	−$1.2B	−$989M	−$856M
Owner earnings	$2.5B	$2.1B	$1.8B	$899M	$1.5B
Owner-earnings marginowner earnings ÷ revenue	9%	7%	7%	4%	7%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $203M), owner earnings is nearer $2.3B.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? —

Interest expense not tagged in the data

What this means
No usable interest-expense line was tagged in the filing data, but the balance sheet carries real net debt — so the interest burden here is unknown, not absent. Read the debt on the net-debt check below.
How heavy is the debt, net of cash? $2.4B · 0.8× operating profit

Modest net debt

Cash $3.7B − debt $6.1B

What this means
Netting $3.7B of cash and short-term investments against $6.1B of debt leaves $2.4B owed, about 0.8× a year's operating profit (2.0× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 102d

Long (60+ days)

DSO 87 + DIO 192 − DPO 178 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 2%

Below average through the cycle

10-yr median, range -77%–15%; 13% latest = NOPAT $2.8B ÷ invested capital $21.2B

Industry peers: median 10%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 13% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 9%

Solid, recently turned positive

latest $2.5B = operating cash $3.8B − maintenance capex $1.3B; positive each of the last 3 years, after an earlier loss stretch (10-yr median 4%)

Industry peers: median 7%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 9% of revenue this year, a 4% median across 10 years. Treating stock comp as the real expense it is (less $203M of SBC) leaves $2.3B.
Are earnings backed by cash? 1.47×

Cash-backed

Cash from ops $3.8B ÷ net income $2.6B

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 51%

Returns about half

Dividends + buybacks $1.3B ÷ Owner Earnings $2.5B

What this means
Of $2.5B Owner Earnings, $1.3B (51%) went back to shareholders, $910M dividends, $384M buybacks. Net of $203M stock comp, the real buyback was about $181M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 1.07×

Maintaining

Capex $1.3B ÷ depreciation $1.2B

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $27.7B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 1.36×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Near

Debt ≤ working capital · $6.1B vs $5.0B WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 5 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Near

Uninterrupted dividends · 9 of 10 yrs

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Pass

Earnings +33% over the record · +8063%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $3.24/share (latest year $3.35), the averaged base the calculator's gate runs on, and book value is $24.36/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 5 of 10

What this means
Lost money in 5 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 2% → 10% (3-yr avg ends)

In the filing’s words The words confirm the number: the filing says price increases held their volume, and the margin widened with them — Buffett’s strongest mark of pricing power.

What this means
Through the cycle the operating margin widened — about 2% early to 10% lately, median 5% — pricing power intact or improving.
Reinvestment, incremental ROIC returns capital

What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
Worst year 2020 · −77.2% op. margin

What this means
Operations went underwater in 2020, understand why before trusting the good years.
Dividend record rising

What this means
Paid and raised the dividend across the record, the continuity Graham prized.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“We may use AI, machine learning, data science and similar technologies in our business, products and services, and challenges with properly managing such technologies could result in reputational harm, competitive harm or legal liability, and adversely affect our business, financial condition and results of operations.…”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$28.6B

Cash & short-term investments$14.8B
Receivables$6.7B
Inventory$4.9B
Other current assets$2.3B

Current liabilities$13.4B

Debt due within a year$753M
Accounts payable$4.3B
Other current liabilities$8.4B

Current ratio2.13×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.77×stricter: inventory excluded

Cash ratio1.10×strictest: cash alone against what's due

Working capital$15.2Bthe cushion left after near-term bills

Debt due this year vs. cash$753M due · $14.8B cash covered by cash on hand, no refinancing forced · both figures from the Mar 31, 2026 balance sheet

Revenue, latest quarter vs. a year ago+2.5%the freshest read on whether the business is still growing

Current ratio, recent quarters1.3× → 2.1×

Deeper floors

Tangible book value$9.2Bequity stripped of goodwill & intangibles

Net current asset value$28.6BGraham's net-net: current assets less all liabilities

Debt incl. operating leases$1.4B$615M of it operating leases

Deferred revenue$6.0Bcustomer cash collected before delivery; operating float

From the company's latest filing.

Debt maturity

the debt note, SEC EDGAR →

Not how much it owes, but when it falls due, and against what. The ladder the company files, beside cash on hand and a year's owner earnings.

'26$600M

'27$1.4B

'28$0

'29$760M

'30$500M

later$2.5B

Bars scaled to the largest single year; “later” is everything due after 2030, shown apart since it dwarfs the years.

Due in the next 12 months$600Mthe first rung: what must be repaid or rolled over within the year

Within two years$1.9Bthe near wall, the part most exposed to today’s credit conditions

Biggest single year$1.4Bin 2027the lumpiest maturity, where a refinancing, if needed, is largest

Total scheduled principal$5.7Bevery year plus what lies beyond, as the footnote totals it

Against what the business has and earns

Cash & short-term investments, Mar 31, 2026$14.8B

One year of owner earnings (FY2025)$2.5B

Together, against $600M due next year28.8×

Cash on hand as of Mar 31, 2026 plus a year’s owner earnings comes to $17.3B against the $600M due in the twelve months after the Dec 31, 2025 schedule: 29 times it.

Maturity schedule extracted from the company’s Dec 31, 2025 annual report and reconciled to the total the table states.

How the cash was used, 2016–2025

Over the record, the business generated $19.1B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$9.9B · 52%
Dividends$5.2B · 27%
Buybacks$3.2B · 17%
Retained (debt / cash)$771M · 4%

Returned to owners$8.4B
92% of the owner earnings the business produced over the span, $5.2B as dividends and $3.2B as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span debt rose $15.9B and cash and short-term investments rose $13.8B.
Average price paid for buybacks$30.11
Across the years where the filing reports a share count, 89M shares were bought for $2.7B, about $30.11 each. Year to year the price paid ranged from $24.66 (2021) to $39.18 (2025); its heaviest year, 2022, paid $27.88 ($828M).
Net change in share count—
No continuous share count across the span.
Dividend recordPays
Paid in 9 of the years on record. It was never cut over the span.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$10.2B25% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity32%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$5.4Bover 10 years buying other businesses, against $9.9B of capital spent building

$14.8B written down across 1 year (2020): goodwill the company has already conceded it overpaid for, charged against earnings. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Mr. Simonelli	$15.6M	$21.8M	$1.5B
2022	Mr. Simonelli	$16.1M	$14.5M	$899M
2023	Mr. Simonelli	$22.2M	$28.1M	$1.8B
2024	Mr. Simonelli	$19.9M	$43.2M	$2.1B
2025	Mr. Simonelli	$21.4M	$33.4M	$2.5B

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio310:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$203M
The slice of the business handed to employees in shares this year, 1% of revenue, equal to 7% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Baker Hughes Company is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

2 of the 4 tests turned up something to look into; the other 2 came back clean.

Look hereDid debt outgrow the business?$277M → $16.2B
Debt rose from $277M to $16.2B while owner earnings went from about ($286M) to $2.1B: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
Look hereAre "one-time" charges a yearly habit?6 of 10 years
Management took an impairment or write-down in 6 of the last 10 years, $15.7B in all. Taken across the majority of the record, the "one-time" label is wearing thin — ask whether these are past deals coming due rather than genuinely isolated events. Read it beside the goodwill the company still carries.

And these came back clean

Is it less profitable than it was?
Did receivables and inventory outpace sales?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Oilfield Services & Equipment

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
CATCaterpillar Inc.	$67.6B	31%	14.3%	19%	12%
CMICummins Inc.	$33.7B	25%	11.3%	20%	8%
BKRBaker Hughes Company	$27.7B	66%	5.1%	3%	4%
ETNEaton Corporation PLC	$27.4B	33%	16.3%	12%	11%
JCIJohnson Controls International PLC	$23.6B	34%	9.7%	7%	6%
CNHCNH Industrial N.V.	$15.3B	21%	11.7%	10%	—
FTITechnipFMC plc Ordinary Share	$9.9B	16%	7.0%	4%	6%
NOVNOV Inc.	$8.7B	16%	0.0%	-1%	7%
Group median	—	28%	10.5%	8%	7%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Baker Hughes Company has delivered.

Baker Hughes Company’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Baker Hughes Company earns about $1.1B on its 4.0% median owner-earnings margin. This year’s 9.1% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($1.1B) Net of stock comp (−$198M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+17%/yr

Owner-earnings growth · since FY2018+19%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $2.3B on 773M diluted shares; net debt $1.4B. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh BKR against another business →

The owners of BKR: the meeting and the votes →

Cite: Owner Scorecard, "Baker Hughes Company (BKR), the owner's record," https://ownerscorecard.com/c/BKR, data as of 2026-07-09.

Manual order: ← BKNG its page in the Manual BKSY →

Industry order: ← AROC the Oilfield Services & Equipment chapter BORR →