SLB (SLB) Registers a Bigger Fall Than the Market: Important Facts to Note

SLB (SLB) ended the recent trading session at $56.01, demonstrating a -1.82% change from the preceding day's closing price. The stock's change was less than the S&P 500's daily loss of 0.59%. At the same time, the Dow lost 0.6%, and the tech-heavy Nasdaq lost 0.65%.

Heading into today, shares of the world's largest oilfield services company had gained 8.44% over the past month, outpacing the Business Services sector's loss of 3.5% and the S&P 500's loss of 1.37%.

The investment community will be closely monitoring the performance of SLB in its forthcoming earnings report. On that day, SLB is projected to report earnings of $0.62 per share, which would represent a year-over-year decline of 10.14%. Meanwhile, our latest consensus estimate is calling for revenue of $9.29 billion, up 4.04% from the prior-year quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $2.5 per share and revenue of $37.11 billion, indicating changes of -14.68% and +3.93%, respectively, compared to the previous year.

Any recent changes to analyst estimates for SLB should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.07% higher within the past month. SLB is holding a Zacks Rank of #3 (Hold) right now.

From a valuation perspective, SLB is currently exchanging hands at a Forward P/E ratio of 22.81. This denotes a premium relative to the industry average Forward P/E of 17.96.

It's also important to note that SLB currently trades at a PEG ratio of 3.24. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Technology Services industry stood at 1.26 at the close of the market yesterday.

The Technology Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 163, which puts it in the bottom 34% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.

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This article originally published on Zacks Investment Research (zacks.com).

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