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Leading oilfield services company, Schlumberger Limited (SLB - Analyst Report) is set to report its first-quarter 2013 results on Apr 19, 2013. Let’s see how things are shaping up prior to the announcement.

In the last quarter, the company’s earnings of $1.08 per share decreased 1.8% from $1.10 per share earned in the year-ago quarter. The quarterly results were adversely impacted by the seasonal slowdown, contract delays and mobilization, along with project start-up costs. However the results were in line with the Zacks Consensus Estimate.

Growth Factors this Past Quarter

In the first quarter, Schlumberger witnessed lower-than-expected U.S. drilling activity resulting in an uncertain outlook for the North America land market. Although Schlumberger’s asset deployment recovered from a holiday slowdown and the costs of its key hydraulic fracturing constituents (like guar) were lower, it continues to expect negative pricing pressure in many product lines for the first quarter. Finally, volatile natural gas prices, arising out of hydraulic fracturing technique, have also affected the demand for gas-directed activity in North America.

However owing to Schlumberger’s far-reaching international presence and deep-water exploration, it faces less North America exposure than rivals like Baker Hughes Inc. (BHI - Analyst Report).

In the international arena, although Schlumberger experienced a choppy fourth quarter 2012 due to transitory issues, activity levels are expected to enjoy growth throughout 2013. The company also aims at double-digit earnings growth for this year, provided North America land activity and pricing levels are up to its expectations. The earnings assumption also takes into account a resolution in Venezuela, where the company registered a major slowdown in payment collection last quarter.

The company is aiming for continued international improvement underpinned by Saudi Arabia, Iraq, Russia, China and Africa for the coming quarters. In the Gulf of Mexico, however, the activity level remains temporarily affected by the substitution of subsea connector bolts on some rigs in the region.

Earnings Whispers?

Our proven model does not conclusively show that Schlumberger is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive earnings Expected Surprise Prediction ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank #1, #2 or #3 for this to happen. This is not the case here as you will see below.

Zacks ESP: The Expected Surprise Prediction or ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is 0.00%. This is because both the Most Accurate Estimate and Zacks Consensus Estimate currently stands at 99 cents.

Zacks Rank #3 (Hold): Schlumberger’s Zacks Rank #3 (Hold) lowers the predictive power of ESP because the Zacks Rank #3 when combined with an ESP of 0.00% indicates the possibility of in line results. We caution against stocks with Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Stocks to Consider

Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter.

Exterran Partners, L.P. (EXLP - Snapshot Report), Earnings ESP of +4.35% and a Zacks Rank #1 (Strong Buy)

Chesapeake Energy Corporation (CHK - Analyst Report), Earnings ESP of +4.35% and a Zacks Rank #2 (Buy)

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