Schlumberger’s stock price compared to industry
Schlumberger’s (SLB) one-year stock price was down 14% as of June 23, 2017. In the past one year, the Energy Select Sector SPDR ETF (XLE), the broader energy industry ETF, has fallen 4%. The VanEck Vectors Oil Services ETF (OIH) has generated -15% one-year returns. So, SLB has performed nearly in line with OIH in the past year. OIH is an ETF tracking an index of 25 oilfield equipment and services (or OFS) companies. The Dow Jones Industrial Average (DJIA-INDEX) rose 23% in the past one year.
The energy sector makes up 6.0% of the DJIA-INDEX. Schlumberger has significantly underperformed the SPDR S&P 500 ETF (SPY), which has produced 20% returns during the same period. Read more on SLB in Market Realist’s What Could Drive Schlumberger’s Returns in 2H17 and Beyond?
Crude oil price and rigs
The West Texas Intermediate (or WTI) crude oil price has witnessed a 10% fall in the past one year. The US rig count increased 124% in the past one year despite crude oil prices turning bearish in recent times. Read what’s causing crude oil price to drop in Is $40 Coming Soon for US Crude Oil? Also, read how prominent OFS companies like Halliburton (HAL) and Weatherford International (NOV) have been faring in recent times in Market Realist’s Weighing SLB, HAL, NOV, and WFT after 1Q17.
Recent events that could affect Schlumberger’s returns
- On June 20, Schlumberger disclosed that it didn’t endorse TRC Capital’s unsolicited mini-tender offer. TRC Capital sought less than 1% of Schlumberger’s outstanding shares.
- On June 14, 2017, Schlumberger announced a strategic partnership with Seitel related to reimaging and new geophysical data acquisition in Mexico.
- SLB signed a memorandum of understanding with Saudi Aramco of Saudi Arabia in May 2017. Earlier, in March 2017, Schlumberger and Weatherford International (WFT) disclosed a proposed joint venture (or JV) named “OneStimSM.” Read Market Realist’s What to Expect from Schlumberger Stock after JV with Weatherford.
In this series, we’ll look at investors’ short interest in SLB and the company’s correlation with crude oil. We’ll look at SLB’s implied volatility next.