Schlumberger: Relief Insight For Investors

Summary:

• Schlumberger is highly influenced by oil prices, with 80% of revenues projected from oil prices 15 months prior, making valuation challenging.
• SLB has historically overpaid for acquisitions, leading to significant asset write-downs and poor returns for long-term investors.
• Despite being asset-intensive, SLB is currently cheaply priced relative to its intrinsic value, with a potential upside if oil prices rise.
• Insider trading suggests overvaluation concerns, but the stock is rated a BUY due to its current low price and potential oil price recovery.

Company Description

Schlumberger (NYSE:SLB) is a global engineering services technology provider for the energy industry. SLB is thought to be the largest service provider to the oil and gas industry. It operates in over 100 countries.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of SLB either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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