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Is an Earnings Beat in Store for Schlumberger (SLB) in Q4?

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Schlumberger Limited (SLB - Free Report) is expected to beat fourth-quarter 2021 earnings estimates when it reports results on Jan 21, before the opening bell.

In the last reported quarter, Schlumberger reported adjusted earnings of 36 cents per share, in line with the Zacks Consensus Estimate, driven by a surge in stimulation activity in Argentina, stronger North American rig activity, and ramped up drilling operations at offshore and onshore international resources. This was offset by lower contributions related to Digital & Integration from Europe/CIS/Africa.

As far as earnings surprise is concerned, the Houston, TX-based company is on a firm footing as it beat the Zacks Consensus Estimate in three of the last four quarters, the average surprise being 12.03%. This is depicted in the graph below:

Schlumberger Limited Price and EPS Surprise

Schlumberger Limited Price and EPS Surprise

Schlumberger Limited price-eps-surprise | Schlumberger Limited Quote

Trend in Estimate Revision

The Zacks Consensus Estimate for fourth-quarter 2021 earnings per share of 39 cents per share has seen one upward estimate revision and no downward movement over the past 30 days. The estimated figure suggests an improvement of 77.3% from the prior-year reported number.

The Zacks Consensus Estimate for revenues of $6.1 billion indicates a 10% improvement from the prior-year quarter.

What the Quantitative Model Suggests

Our proven model predicts an earnings beat for Schlumberger this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: Schlumberger has an Earnings ESP of +2.86%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: Schlumberger currently carries a Zacks Rank #3.

Key Factors to Note

The pricing scenario of oil in the fourth quarter of 2021 has improved drastically from the prior-year comparable period, thanks to the rolling out of coronavirus vaccines. With higher crude prices, drilling activities ramped up significantly globally compared to the prior quarter.

Improved drilling operations by the explorers and producers are likely to have generated handsome cashflows for Schlumberger’s oilfield services. This is because oilfield service players assist drillers in efficiently setting up oil wells.

The Zacks Consensus Estimate for Schlumberger’s pretax operating income from the well construction segment is pegged at $350 million, suggesting a massive improvement from $183 million in the year-ago comparable quarter.

Other Stocks That Warrant a Look

Here are some other firms that you may want to consider as these too have the right combination of elements to post an earnings beat in the upcoming quarterly reports:

PBF Energy Inc. (PBF - Free Report) has an Earnings ESP of +253.12% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

PBF Energy is scheduled to release fourth-quarter 2021 results on Feb 10. The Zacks Consensus Estimate for PBF’s earnings is pegged at 11 cents per share, suggesting an increase of 102.4% from the prior-year reported figure.

BP plc (BP - Free Report) has an Earnings ESP of +8.40% and a Zacks Rank of 1.

BP is scheduled to report fourth-quarter 2021 results on Feb 8. The Zacks Consensus Estimate for BP’s earnings stands at $1.19 per share, suggesting a whopping increase from the prior-year reported figure.

Valero Energy Corporation (VLO - Free Report) has an Earnings ESP of +10.16% and a Zacks Rank #3.

Valero Energy is scheduled to release fourth-quarter 2021 results on Jan 27. The Zacks Consensus Estimate for Valero Energy’s earnings is pegged at $1.58 per share, suggesting an increase of 249.1% from the prior-year reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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PBF Energy Inc. (PBF) - free report >>