Stock Analysis | Schlumberger Outlook - Technical Weakness and Mixed Analyst Views

Market Snapshot

SLB is underperforming technically with a weak outlook, despite positive cash flow and earnings growth. The stock is currently trading in a volatile pattern with bearish momentum and mixed analyst sentiment.

News Highlights

• U.S. accelerates geothermal energy projects: The Department of Interior announced emergency permitting to fast-track geothermal projects, which could benefit Schlumberger’s energy services division.
• China's factory activity slows but improves: China’s PMI rose slightly to 49.5, signaling a slowing contraction in factory activity, which might support global demand for energy services in the longer run.
• Trump fast-tracks Utah uranium mine: While the move may not immediately revive the uranium industry, it could indirectly affect Schlumberger’s exposure to mining and energy resources in the region.

Analyst Views & Fundamentals

Analysts remain cautiously optimistic, with a simple average rating of 5.00 and a performance-weighted rating of 4.44. The ratings are not entirely consistent, with a “There are differences” consensus. Despite the divergence, both ratings are aligned with the recent price rise of 0.59%, suggesting market expectations are leaning bullish.

On the fundamental side, key factors show a mixed picture:

• Return on Assets (ROA): 2.15% (internal diagnostic score: 3).
• Net Profit Margin (NPM): 12.26% (internal diagnostic score: 3).
• Net Income / Revenue: 33.06% (internal diagnostic score: 1).
• Basic Earnings Per Share (YoY Growth): -13.07% (internal diagnostic score: 4).
• Net Cash Flow from Operating Activities / Total Liabilities: 6.62% (internal diagnostic score: 2).
• Interest Coverage Ratio (EBIT / Interest Expense): 912.46% (internal diagnostic score: 2).
• Diluted Earnings Per Share (YoY Growth): -12.58% (internal diagnostic score: 4).
• Cash / Market Value: 36.15% (internal diagnostic score: 2).

These fundamentals suggest solid liquidity and interest coverage, but earnings and revenue growth are lagging, weighing on investor sentiment.

Money-Flow Trends

Big-money trends are negative, with an overall inflow ratio of 48.47%, suggesting institutional investors are cautious. Interestingly, retail flows are positive at 50.47%, showing retail confidence despite technical headwinds.

Breakdown of inflow ratios by investor size:

• Small investors: 50.47%, trend positive.
• Medium investors: 48.85%, trend negative.
• Large investors: 49.70%, trend negative.
• Extra-large investors: 47.61%, trend negative.

This mismatch between retail and institutional flows could lead to short-term volatility as the market digests conflicting signals.

Key Technical Signals

The technical outlook for Schlumberger remains weak, with an internal diagnostic score of 3.86 and three bearish indicators out of six analyzed.

Key technical indicators and their internal diagnostic scores (0-10):

• WR Overbought: Score: 1.51 – Suggests overbought conditions are not strong enough to reverse the trend.
• RSI Overbought: Score: 1.32 – Strong bearish bias in overbought conditions.
• Marubozu White: Score: 3.27 – Neutral bias, but historically negative returns.
• Ex-Dividend Date: Score: 6.5 – Slightly bullish, but not enough to counter bearish signals.
• Dividend Record Date: Score: 6.5 – Neutral with mixed historical performance.
• Bullish Engulfing: Score: 4.05 – Moderate bullish potential, but not confirmed by price action.

Recent chart patterns (Last 5 days):

• 2025-08-26: WR Overbought
• 2025-08-27: WR Overbought, Bullish Engulfing
• 2025-08-28: WR Overbought, RSI Overbought
• 2025-08-29: WR Overbought, RSI Overbought, Marubozu White
• 2025-09-03: Ex-Dividend Date, Dividend Record Date

These patterns suggest a lack of clear direction, with bearish signals dominating and bullish ones failing to confirm. Traders should watch for a breakout or breakdown in the near term.

Conclusion

Consider waiting for a pull-back before initiating a long position in Schlumberger. While the fundamentals remain stable and the market is showing some retail optimism, the technical picture is bearish, with overbought conditions failing to hold and bearish momentum dominating. Keep an eye on the next set of earnings and institutional sentiment shifts as potential catalysts.