Stock Analysis | Schlumberger Outlook - A Weak Technical Picture Amid Mixed Analyst Expectations

Market Snapshot

SLB's technical indicators are bearish with weak momentum. Traders are advised to avoid the stock based on recent chart patterns and internal diagnostic scores (0-10) of 3.32.

News Highlights

Recent headlines offer limited relevance to Schlumberger, but a few key developments:

• Equipment Sector Activity: Several U.S. and global energy companies are strengthening their commitments to domestic manufacturers, such as Michigan-based suppliers, which could indirectly benefit Schlumberger in the long term.
• Corporate Mergers: Herc Holdings completed its tender offer for H&E Equipment Services, signaling ongoing consolidation in the equipment and logistics space, which may reflect broader market sentiment for energy services.
• Hydrogen Energy Gains Momentum: Guofu Hydrogen Energy saw a sharp rise in dark pool trading, suggesting growing interest in hydrogen storage and transportation tech—areas that could compete or complement Schlumberger's traditional energy services.

Analyst Views & Fundamentals

Analysts are mixed, with a simple average rating of 4.43 and a performance-weighted score of 3.04. The lack of consensus highlights divergent views on SLB's near-term trajectory:

• UBS has the weakest track record (33.3% historical win rate), yet it rates SLB as "Underperform."
• Piper Sandler rates the stock "Neutral" with a 100% historical win rate, suggesting cautious optimism.
• Stifel and Susquehanna both issue "Strong Buy" ratings, though Stifel has a 50% win rate, while Susquehanna's analysts have a 0% win rate recently.

Despite the mixed ratings, the current price trend is up by 0.33%, suggesting that market expectations broadly align with the price movement.

Fundamental Highlights

• Price-to-Earnings (PE): 44.87 – internal diagnostic score: 0.46 (poor). High valuation suggests limited near-term upside unless earnings surprise.
• Return on Assets (ROA): 2.15% – internal diagnostic score: 7.86 (good). The company is generating a modest return on its assets.
• Net Profit Margin (NPM): 12.26% – internal diagnostic score: 9.02 (very good). Healthy profitability despite sector challenges.
• Revenue-to-Market Value: 84.76% – internal diagnostic score: 8.91 (very good). Indicates strong revenue base relative to market cap.
• Basic Earnings Per Share YoY: -13.07% – internal diagnostic score: 5.54 (moderate). Earnings contraction highlights ongoing pressure on profitability.
• Net Profit YoY: -16.93% – internal diagnostic score: 5.20 (moderate). Continued negative growth in net profit.

Money-Flow Trends

Big money is flowing out of SLB, with overall inflow ratios below 50% across all investor categories. The fund-flow score of 7.77 (internal diagnostic score) is labeled "good," but this reflects the strength of the outflow signal rather than positive sentiment:

• Extra-large investors show the strongest outflow ratio (47.8%) with a negative trend.
• Small retail investors also show a negative trend, with inflow at 49.1%—close to neutral but still bearish.
• Block trades are down at 47.9% inflow, consistent with broader selling pressure.

This suggests a lack of confidence among large institutional and retail investors in SLB’s near-term direction.

Key Technical Signals

Technical indicators are bearish, with an internal diagnostic score of 3.32 and no bullish signals to offset two negative ones. Here's the breakdown:

• WR Oversold: internal diagnostic score: 3.16 – this overbought/oversold indicator is flashing a cautionary signal. It’s appeared frequently in recent sessions (67 historical signals), with a 50.75% win rate and an average 9% return.
• Bearish Engulfing: internal diagnostic score: 3.47 – a bearish candlestick pattern that appeared most recently on August 6. It has appeared 9 times historically with a 44.44% win rate and an average 1.21% return. This pattern reinforces the negative trend.

Recent chart patterns by date (August 4–11):

• August 4: WR Oversold
• August 6: WR Oversold + Bearish Engulfing (double bearish signal)
• August 7–8: WR Oversold repeated

Key insights: The technical side is weak, with bearish signals dominating (2 bearish vs 0 bullish). Market volatility remains high, and trend direction is unclear, making it a risky time to enter or hold the stock.

Conclusion

Consider waiting for a clearer trend or a pullback. While the fundamentals show some strength in margins and ROA, technical indicators and fund flows are decisively bearish. Analyst ratings are mixed, with a heavy bearish influence from key institutions like UBS and Susquehanna. Until there is stronger alignment between fundamentals and price action, it may be prudent to watch the sidelines and monitor upcoming earnings for a potential catalyst.