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Investing.com - BofA Securities has reiterated its Buy rating and $40.00 price target on SLB (NYSE:SLB) despite looming concerns about global oil markets. The stock, currently trading at $33.32, has declined over 8% in the past week and is now trading near its 52-week low, according to InvestingPro data.
The firm notes that global oil markets are facing a meaningful supply and demand surplus later this year and into 2026, which has weighed on oilfield services companies’ estimates as activity steadily slows.
BofA points out that SLB is now trading at 6.3x their 2026 estimated EBITDA, which is 18% below its trough valuation during the last supply-led oil and gas downturn in 2014-15, and only 10% above its trough valuation during the COVID downturn.
The research firm highlights that both upstream and oilfield services sectors have demonstrated more capital expenditure discipline in the current cycle, while SLB has reduced its upstream capital intensity and volatility.
While acknowledging there is no clear short-term catalyst amid challenging macroeconomic conditions, BofA sees "attractive risk/reward for medium/long-term SLB investors" with energy security and gas/power demand growth narratives remaining strong.
In other recent news, SLB has reported its second-quarter 2025 earnings, which exceeded analysts’ expectations with an earnings per share (EPS) of $0.74, slightly above the forecasted $0.73. The company’s revenue also surpassed predictions, reaching $8.55 billion against an anticipated $8.52 billion. Stifel and Jefferies both maintained their Buy ratings on SLB, with price targets of $52.00 and $53.00, respectively, following these results. The recent completion of SLB’s acquisition of ChampionX was highlighted positively, with anticipated synergies expected to enhance the company’s production systems portfolio. Analysts from Jefferies are particularly interested in the integration progress and synergies from this acquisition, along with management’s guidance for the second half of 2025. SLB’s management has expressed confidence in delivering industry-leading margins and has projected second-half revenue between $18.2 billion and $18.8 billion. The integration of ChampionX is expected to be accretive to margins and earnings per share by 2026, with significant synergies anticipated from supply chain and operational efficiencies.
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