Here is Why Schlumberger (SLB) is One of the Best Large Cap Energy Stocks

Schlumberger Limited (NYSE:SLB) is the world’s leading provider of technology for reservoir characterization, drilling, production, and processing to the global energy industry. The company’s clients include major oil and gas producers worldwide.

An aerial view of a well site, depicting the scale of oil and gas operations.

Schlumberger Limited (NYSE:SLB) reported a lackluster performance for its Q1 2024, falling below estimates in both revenue and earnings, primarily due to a significant reduction in drilling activity in Mexico. The company’s adjusted EPS of $0.72 slightly missed expectations by $0.01, while its revenue also fell by 2.5% YoY to $8.49 billion and missed consensus by $102.52 million.

That said, Schlumberger Limited (NYSE:SLB)’s cash flow from operations more than doubled to $660 million in Q1, while its free cash flow came in at $103 million. The company aims to return more than 50% of its free cash flow to shareholders, with a commitment to return a minimum of $4 billion through dividends and share repurchases this year. SLB announced a quarterly dividend of $0.285 per share last month and currently boasts an annual dividend yield of 3.39%.

Schlumberger Limited (NYSE:SLB) has warned that the global upstream investment in 2025 is expected to decline compared to last year, and so the company is working on optimizing supply chains, cutting costs, and aligning resources with activity levels in the coming quarters. Moreover, SLB remains focused on expanding beyond fossil fuels, with its combined revenue from CCS, geothermal, critical minerals, and data center solutions on pace to exceed $1 billion in 2025.

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Disclosure: None.