This Earnings Report Could Set The Tone For Oil This Quarter

Schlumberger Limited SLB is scheduled to report Q4 earnings after the market close on Thursday. It is the first global oil field services company to report Q4 earnings and its results may serve as an indicator for the sector.

The company is projected to post earnings of $1.46 per share on revenue of $12.72 billion.

At the beginning of December, Oppenheimer rated the stock Outperform and set a $114 price target, when the stock was trading around $87.

According to the Oppenheimer report, “Schlumberger is the world’s premier oilfield services company with unparalleled technology, scale, breadth of products and services and geographic diversification. We view the drop in oil prices as an opportunity. The stock tends to outperform peers in down markets, and the company is clearly well positioned to benefit from an increase in E&P spending should oil prices rebound. We believe investors should take advantage of recent stock price weakness and build or add to positions at these levels.”

In January, both Goldman Sachs and SocGen downgraded Schlumberger from Buy to Neutral and Hold, respectively.

Ahead of the earnings report Thursday, Deutsche Bank lowered its Q4 EPS estimate from $1.56 to $1.41 and cut its price target from $119 to $86. The firm maintained a Buy rating.

Schlumberger traded at $77.28 mid-day, down 1.4 percent.