Based in Houston, Texas, Schlumberger Limited (SLB) is a leading oilfield services company that provides services to oil and gas explorers and producers worldwide. Valued at a market cap of $62.81 billion, the company is renowned for its innovation and expertise in the energy industry. It is all set to announce its fiscal Q3 earnings results before the market opens on Friday, Oct. 18.
Ahead of this event, analysts expect the tech company to report a profit of $0.89 per share, up 14.1% from $0.78 per share in the year-ago quarter. Moreover, the company has consistently surpassed Wall Street's bottom-line estimates in the last four quarters.
In Q2, the company reported an EPS of $0.85, which topped the consensus estimates by 2.4%. The earnings beat was primarily driven by growth in broad-based international revenue and margin expansion across all divisions, fueled by elevated activity in the Middle East & Asia.
For fiscal 2024, analysts expect SLB to report an EPS of $3.49, up 17.1% from $2.98 in fiscal 2023.
Shares of Schlumberger have declined 15.1% on a YTD basis, significantly underperforming both the S&P 500 Index's ($SPX) 19.2% rise and the Energy Select Sector SPDR Fund’s (XLE) 9.1% return over the same period.
On Jul. 19, shares of SLB jumped nearly 2% following its Q2 earnings release. Its revenue of $9.14 billion marginally surpassed the consensus estimates while increasing 13% year-over-year. Its adjusted EPS also increased 18% from a year ago.
Moreover, on Oct. 1, the stock rose 2.8% due to an over 2% increase in the oil price amid growing concerns that Middle East tensions could escalate, potentially disrupting crude output from the region, following Iran’s missile attack against Israel.
Analysts' consensus view on Schlumberger’s stock is optimistic, with a "Strong Buy" rating overall. Among 21 analysts covering the stock, 18 recommend a "Strong Buy," two suggest "Moderate Buy," and one indicates a “Hold” rating. The average analyst price target for SLB is $64.63, indicating a 46.1% potential upside from the current levels.
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