I am reaffirming a positive risk/reward rating for Schlumberger (NYSE: SLB) based on the early stages of a new growth cycle, an exceptional multiyear earnings growth trajectory, material upside surprise potential, the company’s global leadership position, and its asymmetric potential return profile.
Risk/Reward Rating: Positive
Schlumberger reported its third consecutive quarter of year-over-year revenue growth on January 21, 2022. The Q4 2021 and full-year financial results confirmed that the energy services sector has officially exited a 6-year bear market while signaling that the first new growth cycle since 2009 is now in force. Given the early stage of the nascent energy services growth cycle, Schlumberger continues to represent an intriguing cyclical growth opportunity as the global leader in the space.
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