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SLB vs. CLB: Which Stock Is the Better Value Option?

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Investors with an interest in Oil and Gas - Field Services stocks have likely encountered both Schlumberger (SLB - Free Report) and Core Laboratories (CLB - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, both Schlumberger and Core Laboratories are holding a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

SLB currently has a forward P/E ratio of 25.41, while CLB has a forward P/E of 40.43. We also note that SLB has a PEG ratio of 0.64. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CLB currently has a PEG ratio of 0.83.

Another notable valuation metric for SLB is its P/B ratio of 4.38. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, CLB has a P/B of 5.69.

These metrics, and several others, help SLB earn a Value grade of B, while CLB has been given a Value grade of C.

Both SLB and CLB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that SLB is the superior value option right now.


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