Schlumberger (SLB) Tops Q1 EPS Estimates

Schlumberger Limited (SLB) rallied $1.81 to $93.70 in after-hours trading Thursday after it reported fiscal results for the first quarter.

In its quarterly report, the world’s largest oilfield services company said it earned $1.06 per share, well above the $0.91 per share analysts were expecting. Revenue however, fell 8.8% yoy to $10.25 billion, below views for $10.35 billion. Q1/15 net income, including charges and credits, came in at $975 million, or $0.76 per share, compared with $1.592 billion, or $1.21 per share, in the first quarter of 2014.

Schlumberger Chairman and CEO Paal Kibsgaard commented, “Schlumberger first-quarter revenue decreased 19% sequentially driven by the severe decline in North American land activity and associated pricing pressure. International operations were impacted by reduced customer spend in addition to seasonal effects in the Northern Hemisphere and the fall in value of the Russian ruble and the Venezuelan bolivar. Three-quarters of the overall sequential decline was due to lower activity and pricing, while the remainder was the result of currency effects and non-recurring year-end sales.”

On valuation measures, Schlumberger Ltd. shares, which currently have an average 3-month trading volume of 8.34 million shares, trade at a trailing-12 P/E of 22.13, a forward P/E of 25.24 and a P/E to growth ratio of 2.67. The median Wall Street price target on the name is $94.00 with a high target of $110.00. Currently ticker boasts 23 ‘Buy’ endorsements, compared to 12 ’Holds’ and 1 ‘Sell’.

Profitability-wise, SLB has a t-12 profit and operating margin of 11.19% and 19.54%, respectively. The $117.19 billion market cap company reported $6.8 billion in cash and short-term investments vs. $8.89 billion in debt in its most recent quarter.

SLB currently prints a one year loss of about 5% and a year-to-date return of 8.35%.

The chart below shows where the equity has traded over the last 52 weeks.

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