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Schlumberger (SLB - Free Report) is finally bullish about its business as energy moves into a multiyear up cycle. This Zacks Rank #1 (Strong Buy) is expected to see double digit earnings growth this year and in 2023.
Schlumberger describes itself as a technology company that partners with customers to access energy. It deploys digital solutions and innovative technologies in the energy industry, including oil and natural gas.
It has expertise in 120 countries.
5 Years of Beating on Earnings
Even when market conditions weren't favorable for Schlumberger, it still put together an incredible earnings surprise track record. It hasn't missed on earnings in 5 years.
On July 22, 2022, it continued with that record as it beat on earnings again for the second quarter, reporting $0.50 versus the Zacks Consensus of $0.40.
Revenue rose 20% year-over-year to $6.8 billion as North American revenue rose 42% to $1.5 billion from $1.1 billion a year ago and International revenue jumped 15% to $5.2 billion from $4.5 billion a year ago.
Schlumberger was bullish.
"Growth was broad-based, driven by an increase in activity internationally, in North America, and across all Divisions," said Olivier Le Peuch, CEO.
"The quarter was also characterized by a favorable mix of exploration and offshore activity and the increasing impact of improved pricing, resulting in the largest sequential quarterly growth since 2010," he added.
Raised Full Year Guidance
In July, business was looking so strong that Schlumberger raised full year guidance.
The analysts also did the same.
The 2022 Zacks Consensus Estimate jumped to $2.02 from $1.86 over the last 60 days as 8 estimates were revised higher. That is earnings growth of 57.8%.
The analysts are bullish about 2023 as well. 7 estimates were raised over the last 2 months and it has pushed up the Zacks Consensus to $2.77 from $2.60 during that time.
That is further earnings growth of 37.3%.
What does that look like on the chart? It's a beauty.
Image Source: Zacks Investment Research
Shares Up on the Year
After shares tumbled to new 5-year lows during the start of the pandemic, they have turned it around with a multi-year rally.
Shares are up 28% this year but they peaked in June and have fallen 7.6% over the last 3 months.
Is Schlumberger a deal?
It has a forward P/E of 19.7, which isn't altogether cheap, but it does have a PEG ratio of 0.5. A PEG ratio under 1.0 usually indicates a company is undervalued.
Schlumberger is giving some of its cash back to shareholders. It pays a dividend yielding 1.8%.
For investors looking for a company with rising earnings estimates this year and next, Schlumberger should be on your short list.
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Bull of the Day: Schlumberger (SLB)
Schlumberger (SLB - Free Report) is finally bullish about its business as energy moves into a multiyear up cycle. This Zacks Rank #1 (Strong Buy) is expected to see double digit earnings growth this year and in 2023.
Schlumberger describes itself as a technology company that partners with customers to access energy. It deploys digital solutions and innovative technologies in the energy industry, including oil and natural gas.
It has expertise in 120 countries.
5 Years of Beating on Earnings
Even when market conditions weren't favorable for Schlumberger, it still put together an incredible earnings surprise track record. It hasn't missed on earnings in 5 years.
On July 22, 2022, it continued with that record as it beat on earnings again for the second quarter, reporting $0.50 versus the Zacks Consensus of $0.40.
Revenue rose 20% year-over-year to $6.8 billion as North American revenue rose 42% to $1.5 billion from $1.1 billion a year ago and International revenue jumped 15% to $5.2 billion from $4.5 billion a year ago.
Schlumberger was bullish.
"Growth was broad-based, driven by an increase in activity internationally, in North America, and across all Divisions," said Olivier Le Peuch, CEO.
"The quarter was also characterized by a favorable mix of exploration and offshore activity and the increasing impact of improved pricing, resulting in the largest sequential quarterly growth since 2010," he added.
Raised Full Year Guidance
In July, business was looking so strong that Schlumberger raised full year guidance.
The analysts also did the same.
The 2022 Zacks Consensus Estimate jumped to $2.02 from $1.86 over the last 60 days as 8 estimates were revised higher. That is earnings growth of 57.8%.
The analysts are bullish about 2023 as well. 7 estimates were raised over the last 2 months and it has pushed up the Zacks Consensus to $2.77 from $2.60 during that time.
That is further earnings growth of 37.3%.
What does that look like on the chart? It's a beauty.
Image Source: Zacks Investment Research
Shares Up on the Year
After shares tumbled to new 5-year lows during the start of the pandemic, they have turned it around with a multi-year rally.
Shares are up 28% this year but they peaked in June and have fallen 7.6% over the last 3 months.
Is Schlumberger a deal?
It has a forward P/E of 19.7, which isn't altogether cheap, but it does have a PEG ratio of 0.5. A PEG ratio under 1.0 usually indicates a company is undervalued.
Schlumberger is giving some of its cash back to shareholders. It pays a dividend yielding 1.8%.
For investors looking for a company with rising earnings estimates this year and next, Schlumberger should be on your short list.