Each earnings season, we look forward to poring over quarterly results from the big four oil-field services companies–Schlumberger (NYSE: SLB), Halliburton (NYSE: HAL), Baker Hughes (NYSE: BHI) and Weatherford International (NYSE: WFT).
Part of this anticipation reflects our bullish long-term outlook for the industry, which stands to benefit from the end of easy oil–an important secular trend that’s one of the founding precepts of Energy & Income Advisor. For the uninitiated, this theme holds that declining production from the world’s major oil fields has forced the industry to pursue deepwater developments and other complex, expensive-to-produce plays that require higher levels of service intensity. (See Going Long: The End of Easy Oil.)
Source: Bloomberg, Halliburton
We have a vested interest in closely monitoring and dissecting the big four’s quarterly results; Schlumberger and Weatherford International both appear in our Focus List. Meanwhile, the big four’s conference calls to discuss quarterly earnings–particularly the wide-ranging calls hosted by Schlumberger, the world’s largest oil-field services company–provide invaluable insights into other aspects of the energy patch.
In the past, close listening to Schlumberger’s quarterly conference calls has helped us to profit from rapidly improving margins in the marine-seismic services segment in 2010 and to avoid much of the fallout from the collapse in pressure-pumping prices that occurred in 2012. The read-through from Schlumberger and the other major oil-field services companies’ earnings reports and subsequent conference calls are particularly useful because they occur before many other energy-related names announce quarterly results.
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In October 2012, renowned energy expert Elliott Gue launched the Energy & Income Advisor, a twice-monthly investment advisory that's dedicated to unearthing the most profitable opportunities in the sector, from growth stocks to high-yielding utilities, royalty trusts and master limited partnerships.
Elliott and Roger on Oct. 29, 2020
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