BHI posts Q3 EPS of $0.26, before $0.08 of 1X charges, vs. $1.39,
$0.12 below our est and $0.10 below Street. Results were hurt by
surprisingly weak margins in BHI's international operations,
which BHI attributed to extra costs associated with its internal
organization transition. Combined with the BJ Services deal (BJS
19***), which BHI now thinks will close in Q1 '10, pending
approvals, we think near-term margin performance may suffer, but
long-term prospects look brighter. Blending our DCF model with
relative metrics, we keep our 12-month target price of $47.
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