Schlumberger (SLB, Financial) saw its stock value decrease by 1.17% as the company reported disappointing first-quarter results. This decline in the stock price reflects investor concerns over the company's year-over-year declines in both revenue and profitability. Despite the overall market turbulence, Schlumberger's stock is currently priced at $34.52.
In its latest earnings report, Schlumberger reported a 3% decrease in revenue to $8.49 billion, alongside a 9% fall in non-GAAP net income to $988 million, or $0.72 per share. These results fell short of analyst expectations, which anticipated $8.64 billion in revenue and $0.74 per share in adjusted net income. CEO Olivier Le Peuch characterized the quarter as "subdued," attributing mixed regional performances, with growth in the Middle East and North America being countered by slowdowns in Mexico, Saudi Arabia, Africa, and a decline in Russia.
Despite the current challenges, Schlumberger has pledged to return at least $4 billion to shareholders by 2025 through dividends and share buybacks. The board has approved a quarterly dividend of just under $0.29 per share, maintaining the previous payout level. It's noteworthy that Schlumberger's stock has demonstrated a relatively high dividend yield of 3.22%, which is close to its three-year high.
From a valuation perspective, Schlumberger's stock appears promising. Its current price-to-earnings (PE) ratio of 11.1 is close to the 10-year low, suggesting potential value for investors. Furthermore, GuruFocus has rated Schlumberger as "Significantly Undervalued" with a GF Value of $58.6. For more details, you can check the GF Value.
Additionally, Schlumberger's operating margin is expanding, indicating an improvement in efficiency and profitability. With market volatility and insider activities affecting stock dynamics, investors should consider Schlumberger's strong market position in the oilfield-services industry and its proactive shareholder return strategy when assessing investment opportunities.
