Schlumberger Execution 'Pristine,' Deutsche Bank Says

Schlumberger Limited. (NYSE: SLB) on Thursday posted another earnings beat “by leveraging its scale, diversified geographic footprint and product portfolio as well as further progress on its internal transformation process,” Deutsche Bank analysts Mike Urban, Jason Bandel and Chris Snyder note in a report.

The Results

The Paris-based company reported quarterly net earnings of $1.12 billion, or $0.88 per share, compared to $1.37 per share reported a year ago. The Street’s consensus stood at $0.79 per share.

Related Link: Schlumberger Q2 Profit Tops Expectations

Revenues came slightly short of expectations, at $9.01 billion versus consensus of $9.12 billion.

A Closer Look

Analysts at Deutsche Bank said despite of steep declines in activity and pricing, Schlumberger “comfortably outperformed the drop in spending in both North America (NAM) and International while suffering only modest decremental margins compared to what most of the industry is likely to report and much better than their own performance in prior downturns.”

The analysts expect to be somewhat muted forward guidance (especially on International margins), but would still anticipate a positive reaction in the stock.

Consequently, the firm maintains a Buy rating and $108.00 price target on shares of Schlumberger.

Earnings are expected to come in at $0.72 per share in the next quarter, at $3.31 per share for the full year, and at $3.74 per share next year.