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Schlumberger Ltd SLB

Morningstar Rating
$43.00 −0.81 (1.85%)
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Company Report

OPEC+ Production Cut Extensions Send Clear Signal That Oil Markets Remain Oversupplied

The complexity of OPEC’s meeting outcome from June 2 should not obscure our view that it continues to operate from a position of weakness in an oversupplied market, pointing to near-term oil price weakness. We anticipate oil prices are more likely to hit $70 a barrel (WTI) and perhaps below $65 by the end of 2024. OPEC has three separate cuts in progress at the moment, totaling 5.86 million barrels per day. A groupwide cut of about 2 million barrels per day was originally set to expire at the end of 2024 but was extended to the end of 2025. Similarly, a 1.7 million barrels per day voluntary cut by certain members was also extended to the end of 2025 from the end of 2024. Finally, a second 2.2 million barrels per day voluntary cut by certain members was extended in full for another quarter, as it was due to expire at the end of June, before gradually being phased out by September 2025. Undervalued options have been harder to find in the energy space recently, but we favor SLB, Enbridge, TC Energy, APA, and Exxon Mobil.

Price vs Fair Value

SLB is trading within a range we consider fairly valued.
Price
$43.00
Fair Value
$94.00
Uncertainty
High
1-Star Price
$14.00
5-Star Price
$87.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

SLB’s routine investment in research and development have made it the leading innovator in oilfield services.

Bears

Decreased oil demand in the long run could limit SLB’s growth potential over time.

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News

Trading Information

Previous Close Price
$43.81
Day Range
$42.6143.46
52-Week Range
$42.6162.12
Bid/Ask
$42.90 / $42.98
Market Cap
$61.46 Bil
Volume/Avg
12.7 Mil / 10.3 Mil

Key Statistics

Price/Earnings (Normalized)
13.83
Price/Sales
1.82
Dividend Yield (Trailing)
2.44%
Dividend Yield (Forward)
2.56%
Total Yield
3.64%

Company Profile

SLB is the largest oilfield service firm in the world, with expertise in myriad disciplines, including reservoir performance, well construction, production enhancement, and more recently, digital solutions. It maintains a reputation as one of the industry’s leading innovators, which has earned it dominant share in numerous end markets.
Sector
Energy
Industry
Oil & Gas Equipment & Services
Stock Style Box
Large Value
Total Number of Employees
111,000

Competitors

Valuation

Metric
SLB
WFRD
HAL
Price/Earnings (Normalized)
13.8316.8810.35
Price/Book Value
2.967.483.02
Price/Sales
1.821.561.28
Price/Cash Flow
8.848.587.87
Price/Earnings
SLB
WFRD
HAL

Financial Strength

Metric
SLB
WFRD
HAL
Quick Ratio
0.911.151.30
Current Ratio
1.371.842.12
Interest Coverage
11.745.705.98
Quick Ratio
SLB
WFRD
HAL

Profitability

Metric
SLB
WFRD
HAL
Return on Assets (Normalized)
9.54%10.61%11.75%
Return on Equity (Normalized)
22.91%65.22%31.52%
Return on Invested Capital (Normalized)
14.48%21.18%18.09%
Return on Assets
SLB
WFRD
HAL
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Oil & Gas Equipment & Services Industry Comparables

1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
Baker Hughes Co Class A
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Halliburton Co
HAL
PvdwcnymgGqptgc$29.1 Bil
Tenaris SA ADR
TS
NlxwbypmZsp$17.4 Bil
TechnipFMC PLC
FTI
FkxntgyrZcf$10.5 Bil
Weatherford International PLC Ordinary Shares - New
WFRD
DhvpdJms$8.1 Bil
NOV Inc
NOV
HrzpkgzrbYnjs$6.9 Bil
ChampionX Corp
CHX
XdbcwjlhZlvb$5.7 Bil
Liberty Energy Inc Class A
LBRT
NxqrpztqKgv$3.4 Bil
Expro Group Holdings NV
XPRO
YzfxzzlxMdtg$2.5 Bil

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