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Schlumberger Limited’s (SLB - Free Report) third-quarter 2018 earnings of 46 cents per share (excluding charges and credits) trumped the Zacks Consensus Estimate of 45 cents and also improved from the year-ago quarter’s adjusted figure of 42 cents.
The oilfield service giant logged total revenues of $8,504 million, which rose from $7,905 million in the prior-year quarter. However, the figure lagged the Zacks Consensus Estimate of $8,593 million.
The results were driven by massive drilling activities in the international market. Improved performances by the company’s directional drilling operations in the North American land resources and strong vertically integrated sand businesses also supported the impressive third-quarter numbers. However, the performance was partially negated by reduced hydraulic fracturing activities in the international market.
Segmental Performance
Drilling and Production units registered a year-over-year increase in revenues while Reservoir Characterization results declined from the year-ago quarter’s tally.
Drilling segment revenues increased primarily on contributions from robust activities in the international markets, namely Russia, Saudi Arabia, Mexico, India and Iraq following deployment of additional rigs. Moreover, the company’s directional drilling businesses performed well in the unconventional resources in North America, boosting the segment’s revenues.
The pre-tax operating income of the segment was backed by higher profitability from some of the company’s Integrated drilling services (IDS) developments that commenced operating in the preceding quarter.
Results in the Production segment were positively impacted by vertically integrated sand businesses. Higher product sales along with robust service activities in Latin America and North America also attributed to this improvement. However, weaker activities associated with hydraulic fracturing in the international market partially offset the segment’s results.
Lower OneSurface sales in Kuwait induced soft revenues at Reservoir Characterization segment, partially compensated by strong contributions from product lines like Wireline and Testing Services following robust summer operations in Russia.
Revenues in the Reservoir Characterization unit totaled $1,673 million, down from $1,771 million in the prior-year period. However, pre-tax operating income was $373 million, up 20% year over year and beating the Zacks Consensus Estimate of $361 million.
Revenues in the Drilling unit summed $2,429 million, up 15% year over year. Pre-tax operating income was $339 million, increasing 13% year over year. However, the figure missed the Zacks Consensus Estimate of $354 million.
Revenues in the Production segment rose 13% from the year-earlier quarter to $3,252 million. Pre-tax operating income jumped 13% year over year to $320 million but fell short of the Zacks Consensus Estimate of $357 million.
Revenues in the Cameron segment amounted to $1,298 million, almost in line year over year. Pre-tax operating income dropped 23% from the prior-year quarter’s figure to $148 million. However, the same beat the Zacks Consensus Estimate of $140 million.
Financials
As of Sep 30, 2018, the company had approximately $2,854 million in cash and short-term investments plus $14,159 million as long-term debt. This represents a debt-to-capitalization ratio of almost 32%. In the July-to-September quarter, the company repurchased shares worth 1.5 million.
Outlook
Schlumberger is expecting demand for crude and world-wide economic growth to remain on a solid ground. This will likely lead to overall higher investments for exploration and production activities in the international market and hence could be a favorable push for its oilfield services businesses.
Although the pipeline bottleneck problem in the Permian Basin has been hurting the company’s operations in U.S. shale plays, it still expects the problem associated with the constraint in pipeline transportation capacity to get settled in the coming 12-18 months.
Schlumberger Limited Price, Consensus and EPS Surprise
Schlumberger currently has a Zacks Rank #3 (Hold). Better-ranked players in the energy space include Shell Midstream Partners LP , Oasis Midstream Partners LP and Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) . While Oasis Midstream and Petrobras carry a Zacks Rank #2 (Buy), Shell Midstream sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shell Midstream Partners delivered an average positive surprise of 7.9% for the last four quarters.
Oasis Midstream will likely see skyrocketing earnings growth of 323.3% and a 60.1% surge in 2018 and 2019, respectively.
Petrobras’ bottom line beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 10.4%.
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It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6% and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Schlumberger (SLB) Q3 Earnings Beat Estimates, Rise Y/Y
Schlumberger Limited’s (SLB - Free Report) third-quarter 2018 earnings of 46 cents per share (excluding charges and credits) trumped the Zacks Consensus Estimate of 45 cents and also improved from the year-ago quarter’s adjusted figure of 42 cents.
The oilfield service giant logged total revenues of $8,504 million, which rose from $7,905 million in the prior-year quarter. However, the figure lagged the Zacks Consensus Estimate of $8,593 million.
The results were driven by massive drilling activities in the international market. Improved performances by the company’s directional drilling operations in the North American land resources and strong vertically integrated sand businesses also supported the impressive third-quarter numbers. However, the performance was partially negated by reduced hydraulic fracturing activities in the international market.
Segmental Performance
Drilling and Production units registered a year-over-year increase in revenues while Reservoir Characterization results declined from the year-ago quarter’s tally.
Drilling segment revenues increased primarily on contributions from robust activities in the international markets, namely Russia, Saudi Arabia, Mexico, India and Iraq following deployment of additional rigs. Moreover, the company’s directional drilling businesses performed well in the unconventional resources in North America, boosting the segment’s revenues.
The pre-tax operating income of the segment was backed by higher profitability from some of the company’s Integrated drilling services (IDS) developments that commenced operating in the preceding quarter.
Results in the Production segment were positively impacted by vertically integrated sand businesses. Higher product sales along with robust service activities in Latin America and North America also attributed to this improvement. However, weaker activities associated with hydraulic fracturing in the international market partially offset the segment’s results.
Lower OneSurface sales in Kuwait induced soft revenues at Reservoir Characterization segment, partially compensated by strong contributions from product lines like Wireline and Testing Services following robust summer operations in Russia.
Revenues in the Reservoir Characterization unit totaled $1,673 million, down from $1,771 million in the prior-year period. However, pre-tax operating income was $373 million, up 20% year over year and beating the Zacks Consensus Estimate of $361 million.
Revenues in the Drilling unit summed $2,429 million, up 15% year over year. Pre-tax operating income was $339 million, increasing 13% year over year. However, the figure missed the Zacks Consensus Estimate of $354 million.
Revenues in the Production segment rose 13% from the year-earlier quarter to $3,252 million. Pre-tax operating income jumped 13% year over year to $320 million but fell short of the Zacks Consensus Estimate of $357 million.
Revenues in the Cameron segment amounted to $1,298 million, almost in line year over year. Pre-tax operating income dropped 23% from the prior-year quarter’s figure to $148 million. However, the same beat the Zacks Consensus Estimate of $140 million.
Financials
As of Sep 30, 2018, the company had approximately $2,854 million in cash and short-term investments plus $14,159 million as long-term debt. This represents a debt-to-capitalization ratio of almost 32%. In the July-to-September quarter, the company repurchased shares worth 1.5 million.
Outlook
Schlumberger is expecting demand for crude and world-wide economic growth to remain on a solid ground. This will likely lead to overall higher investments for exploration and production activities in the international market and hence could be a favorable push for its oilfield services businesses.
Although the pipeline bottleneck problem in the Permian Basin has been hurting the company’s operations in U.S. shale plays, it still expects the problem associated with the constraint in pipeline transportation capacity to get settled in the coming 12-18 months.
Schlumberger Limited Price, Consensus and EPS Surprise
Schlumberger Limited Price, Consensus and EPS Surprise | Schlumberger Limited Quote
Zacks Rank & Key Picks
Schlumberger currently has a Zacks Rank #3 (Hold). Better-ranked players in the energy space include Shell Midstream Partners LP , Oasis Midstream Partners LP and Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) . While Oasis Midstream and Petrobras carry a Zacks Rank #2 (Buy), Shell Midstream sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shell Midstream Partners delivered an average positive surprise of 7.9% for the last four quarters.
Oasis Midstream will likely see skyrocketing earnings growth of 323.3% and a 60.1% surge in 2018 and 2019, respectively.
Petrobras’ bottom line beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 10.4%.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6% and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>