Analyst Daniel Kutz of Morgan Stanley maintained a Buy rating on Schlumberger, retaining the price target of $45.00.
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Daniel Kutz has given his Buy rating due to a combination of factors that highlight Schlumberger’s potential for strong performance. The recent acquisition of ChampionX is expected to enhance Schlumberger’s production-focused portfolio, providing stability and positioning the company as a leader in key market segments like production chemicals and artificial lift. This acquisition, along with Schlumberger’s diversified revenue streams from Digital, New Energy, and data center infrastructure, is anticipated to contribute to durable earnings per share and free cash flow, offering unique growth opportunities that are not fully recognized by the market.
Additionally, Daniel Kutz points to the company’s outsized exposure to international and offshore upstream markets as a significant advantage, especially in light of global gas activity trends. Despite some challenges in international activity and pricing, particularly in regions like Saudi Arabia, Mexico, and Argentina, there is potential for improvement beyond the near term. The combination of these factors supports a constructive tactical view of Schlumberger’s shares, making it a favored stock play over the next 12 to 18 months, with a reiterated price target of $45.
In another report released yesterday, Stifel Nicolaus also maintained a Buy rating on the stock with a $52.00 price target.