Schlumberger Beats As Strong International Operations Offset N. American Weakness

World #1 oil services company Schlumberger Limited (market cap $110 billion) reported net income and revenue above analyst estimates Friday, sending shares higher by 1.12% in pre-market action as of 7:24 a.m. EST.Net profit jumped 47% on strong international performance despite weakness in the Canadian market, to $1.26 billion, good for EPS of $1.02. Revenue climbed 20% to $5.64 billion, on $4.97 billion in oilfield services revenue. Consensus analyst estimates were for EPS of $0.96 on revenue of $5.575 billion. N. American revenue was the weakest link, down 3% sequentially to $1.34 billion, and up just 6% y/y. The company didn't offer specific guidance but believes international oilfield revenue will continue to grow nicely as the production companies combat shortfalls. CEO Andrew Gould praised the "continued favorable revenue mix from exploration services - particularly in Asia." Schlumberger's largest N. American competitor, Halliburton, reports its earnings Monday.

Sources: Press Relese, Bloomberg, MarketWatch, Reuters, Dow Jones Newswires
Commentary: Adding Schlumberger to the Bar Mitzvah Portfolio • The Ins and Outs of Terror-Free Investing • Cramer's Take on SLB
Stocks/ETFs to watch: Schlumberger Limited (SLB). Competitors: Halliburton (HAL), Baker Hughes Inc. (BHI), BJ Services (BJS). ETFs: iShares Dow Jones US Oil Equipment (IEZ), Oil Service HOLDRs (OIH), Vanguard Energy (VDE)
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Comments

[John Gaats:]

Finally, there are some oil concerns come out show their earnings. Oil related (especially refineries) have been so beaten up even though crude price is rising. As a matter of fact, the more the curde rises, the more depressed refineries are. I guess this is a good market response to the subprime thing.

2007 Jul 20 01:23 PM