The Halliburton (NYSE: HAL) stock price is coming off of a rough month. The oilfield services giant lost 5.1% in June after gaining 15.4% during the first five months of the year.
Today's tumble for HAL stock comes alongside crude oil's worst day since April 14. WTI oil prices dropped more than 4% to trade near $54.50 a barrel this morning. At the same time, Brent oil prices declined 1.94% to $59.66.
But the company is still performing significantly better than other Big Oil firms. Halliburton (NYSE: HAL) stock is still up 4% this year. Meanwhile, Exxon Mobil Corp. (NYSE: XOM), Royal Dutch Shell Plc. (NYSE ADR: RDS.A), and Total SA (NYSE ADR: TOT) are down 10.3%, 16.1%, and 7.1% respectively over the same period.
It's clear Halliburton stock is more profitable than most of the oil supermajors right now.
But does that make Halliburton stock a healthy long-term investment?
Should I Buy Halliburton (NYSE: HAL) Stock?
As the second-largest oilfield services (OFS) firm in the world, Halliburton is poised to soar this year as M&A activity transforms the industry.
The M&A market is off to a hot start in 2015…
On April 8, Shell announced its acquisition of BG Group Plc. (OTCMKTS ADR: BRGYY) in the largest energy merger in more than 10 years. In the master limited partnership (MLP) sector, Energy Transfer Partners LP (NYSE: ETP) bought Regency Energy Partners (NYSE: RGP) for $18 billion on April 30. The deal made ETP the second-largest MLP on the market.
More small oil stocks will be bought out by much larger ones throughout the year. The process will create a new group of heavyweight firms that will dominate the market.
"The most likely targets of M&A activity will be energy companies with attractive land leases, pipelines, or other assets, high levels of debt, and declining cash flows," Money Morning Global Energy Strategist Dr. Kent Moors said.
"These types of companies could hand their shareholders a quick profit in 2015 if they get targeted."
In fact, Halliburton is about to make one of the largest acquisitions in the history of the OFS sector…
Last November, the company announced its acquisition of Baker Hughes Inc. (NYSE: BHI) – the third-largest OFS company in the world – for $34.6 billion. The deal was approved by shareholders on March 27 and is expected to close late in the second half of 2015.
After the merger is finalized, the new company will save costs and offer competitive bids against the No. 1 OFS company Schlumberger Ltd. (NYSE: SLB).
The HAL stock price has a one-year target estimate of $101.19 a share. That's 19.8% higher than its July 2 closing price of $84.50.
More on Energy Stocks: Master limited partnerships (MLPs) have seen immense growth over the last decade. But it's important to understand how they work. Here's how you can profit from the MLP sector, which has generated 249% in total returns since 2005…