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A Look At SLB (SLB) Valuation After Venezuela Intervention And New Growth Contracts

Simply Wall St · 2d ago

SLB (NYSE:SLB) is back in focus after the U.S. military intervention in Venezuela sparked expectations that American oil companies could help rebuild the country’s damaged energy sector, which is shifting attention to oilfield service specialists.

See our latest analysis for SLB.

That Venezuela driven spike came on top of an already strong run, with a 90 day share price return of 27.89% and a 1 year total shareholder return of 12.63%, while the 3 year total shareholder return of an 18.90% decline shows that the recent momentum is relatively new compared with the longer term picture.

If you are looking beyond SLB and the current oil headlines, this could be a useful moment to broaden your search and check out fast growing stocks with high insider ownership.

With SLB trading at $42.37, a stated intrinsic value gap of 53.26% and an 11.63% discount to the average analyst price target, the key question is whether this is a genuine mispricing or if markets are already accounting for future growth.

Most Popular Narrative Narrative: 6.5% Undervalued

Against SLB's last close of $42.37, the most followed narrative points to a fair value of $45.31, suggesting modest upside based on long term assumptions discounted at 7.42%.

The integration of ChampionX expands SLB's capabilities in production optimization, chemicals, and digital production technology. It is described as unlocking new revenue synergies through cross-selling and international expansion, while also driving significant cost synergies ($400 million targeted). All of these factors are expected to increase EBITDA margins and earnings per share, notably in 2026 and beyond.

Read the complete narrative.

Curious what sits behind that uplift in margins and earnings. The narrative leans heavily on measured revenue growth, fatter profit margins, and a higher future earnings multiple. Want to see how those ingredients combine to reach that fair value.

Result: Fair Value of $45.31 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, these margin and earnings hopes still run into two key risks: softer global upstream spending and the chance ChampionX synergies prove slower or smaller than expected.

Find out about the key risks to this SLB narrative.

Build Your Own SLB Narrative

If you see the story differently or just want to test your own assumptions against the same data, you can build a custom view of SLB in a few minutes: Do it your way.

A great starting point for your SLB research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If SLB caught your attention, do not stop there. Casting a wider net with pre filtered stock ideas can help you spot opportunities you might otherwise miss.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.