SLB Sounds Alarm On Middle East Crisis, Warns Of Q1 Profit Hit
SLB Ltd (NYSE:SLB) shares edged lower Wednesday after the oilfield services provider issued an update on its operations in the Middle East and warned of a potential impact on first-quarter results.
The company said it continues to closely monitor the evolving situation in the region and is adjusting operations accordingly.
“The safety and security of SLB’s employees is the highest priority, and the company has activated local and regional crisis response teams that are meeting daily,” the company said. Travel to and transit through the region have been suspended. SLB has also begun demobilizing operations in several countries following customer actions aimed at safeguarding personnel and facilities.
The company said these measures will remain in place until conditions stabilize. SLB added it is working with local authorities and customers and plans to resume operations in phases once the environment improves.
First-Quarter Outlook Impact
SLB said first-quarter revenue will be lower than previously expected. The company also anticipates additional costs that could reduce earnings by about 6 to 9 cents per diluted share for the quarter.
Given the evolving geopolitical environment, the company said these estimates could change as it continues to monitor developments.
Despite the disruption, SLB said it remains confident in the resilience of its global business, including the Middle East, citing more than 100 years of experience navigating geopolitical crises while serving its global customer base.
The company had previously expected first-quarter revenue to decline sequentially, with adjusted EBITDA margins projected to fall 150–200 basis points due to typical seasonal activity slowdowns.
Technical Analysis
The stock is currently trading 3% below its 20-day simple moving average (SMA) but is 1.9% above its 50-day SMA, demonstrating some short-term strength.
Over the past 12 months, shares have increased by 21.36% and are currently closer to their 52-week highs than their lows.
The RSI is at 45.91, which is considered neutral territory. Meanwhile, MACD is at -0.1169, below its signal line at 0.5515, indicating bearish pressure on the stock. The combination of neutral RSI and bearish MACD suggests mixed momentum.
- Key Resistance: $52.00
- Key Support: $47.50
Sector Performance
SLB is currently underperforming its sector, with a daily gain of 1.04% compared to the Energy sector’s 1.85% increase. The Energy sector ranks first among all sectors, with a 30-day gain of 5.63% and a 90-day gain of 23.28%.
Despite SLB’s positive momentum, its performance is lagging the broader sector, suggesting that while the company is navigating challenges, it may need to improve operational efficiency to align with sector gains.
Earnings & Analyst Outlook
SLB is expected to provide its next financial update on April 24, 2026.
- EPS Estimate: 61 cents (Down from 72 cents)
- Revenue Estimate: $8.88 Billion (Up from $8.49 Billion)
- Valuation: P/E of 20.5x (Indicates fair valuation)
Analyst Consensus & Recent Actions: The stock carries a Buy Rating with an average price target of $55.46. Recent analyst moves include:
- Goldman Sachs: Buy (Raises Target to $60.00) (Mar. 4)
- Jefferies: Buy (Raises Target to $58.00) (Feb. 2)
- Citigroup: Buy (Raises Target to $56.00) (Jan. 26)
Top ETF Exposure
- Global X PureCap MSCI Energy ETF (NYSE:GXPE): 3.83% Weight
- State Street Energy Select Sector SPDR ETF (NYSE:XLE): 4.45% Weight
- iShares US Energy ETF (NYSE:IYE): 3.99% Weight
Significance: Because SLB carries significant weight in these funds, any significant inflows or outflows will likely trigger automatic buying or selling of the stock.
SLB Price Action: SLB shares were down 0.04% at $48.10 at the time of publication on Wednesday, according to Benzinga Pro data.
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