What Happened?
Shares of oilfield services provider SLB (NYSE: SLB) fell 3.4% in the morning session after WTI crude oil plunged on Iran-US peace deal progress and renewed hopes for reopening the Strait of Hormuz.
Oilfield services companies (Schlumberger (SLB), Halliburton (HAL), Baker Hughes (BKR), TechnipFMC, and the offshore drillers) get paid only when oil producers spend money drilling new wells. When oil prices drop sharply, producers slash their capex budgets within weeks, which directly cuts the revenue these service companies see in the next two to three quarters. Imagine a Permian shale producer that built its 2026 drilling budget assuming $100 oil.
When oil drops to $93 in a single session, the math on the next 50 wells suddenly looks much thinner: fewer barrels make economic sense to extract. Producers respond by deferring or cancelling rig contracts, sand orders, hydraulic fracturing services, and completion equipment. That's exactly what oilfield services sell.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy SLB? Access our full analysis report here, it’s free.
What Is The Market Telling Us
SLB’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was about 1 month ago when the stock gained 2.3% on the news that the company reported decent first-quarter 2026 results that saw revenue beat expectations.
The company posted revenue of $8.72 billion, which was ahead of Wall Street’s estimates but represented a 6.3% decline compared to the same quarter last year. Its adjusted earnings of $0.52 per share were in line with analysts' consensus. A key positive for investors was the company's adjusted EBITDA, which came in at $1.96 billion, beating forecasts by 6.8%.
Although the stock initially fell 3.3% after the announcement, as investors may have been hoping for a stronger report, it later rebounded. The recovery suggests the market ultimately focused on the better-than-expected revenue and EBITDA, despite the year-on-year sales decline and some contracting margins.
SLB is up 39.5% since the beginning of the year, and at $56.06 per share, it is trading close to its 52-week high of $57.98 from May 2026. Investors who bought $1,000 worth of SLB’s shares 5 years ago would now be looking at an investment worth $1,789.
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