Jim Cramer on Tesla and Other Stocks

4. Schlumberger Limited (NYSE:SLB)

Number of Hedge Fund Holders: 67

Schlumberger Limited (NYSE:SLB) was discussed by Cramer during the October 24 episode of Mad Money. Talking about the stock’s performance, he said:

“So far, it’s been a pretty bad year for SLB and Halliburton, the two largest pure-play drillers, both down over 20%… SLB sells for 11 times next year’s earnings estimate. I can’t remember when it was that cheap before… However, those valuations are only attractive if SLB and Halliburton can make the numbers. Otherwise, their stocks’ going to stay in the doghouse.”

Cramer went on to discuss the company’s latest earnings report. Here’s what he said:

“Even though I like the results, the stock still dropped 5% in response, still hasn’t recovered. SLB posted a small revenue miss, paired with a 1 cent earnings beat, off an 88 cent basis… Their cash flow numbers came in much much much higher than expected but management’s commentary about SLB’s outlook for the future… was more mixed. SLB CEO Olivier Le Peuch gave a nuanced update on the industry with some worries about short-cycle oil investment as well as a bunch of positives like significant investments, natural gas production, and some encouraging comments about deepwater drilling projects.

Well, SLB doesn’t give much in the way of formal guidance. Management’s not sounding real super confident about the fourth quarter and for 2025, they’re talking about upstream spending in international market growing by low to mid-single digits. North America’s spending looks to be flat to slightly down. Overall, I think SLB continues to do fine but after communicating a mixed outlook, going forward, I wouldn’t expect Wall Street to give them the benefit of the doubt until we started seeing more signs of an upturn in the global economy.”

Schlumberger (NYSE:SLB) is a provider of technology and services within the global energy sector, focusing on various aspects of field development, hydrocarbon extraction, and carbon management. During the third-quarter earnings call, CEO Olivier Le Peuch highlighted the pressures currently faced by commodity prices, primarily due to concerns over an oversupplied market. This situation stems from increased output by non-OPEC+ producers, uncertainties surrounding OPEC+ supply decisions, reduced demand from China, and slower economic growth in the United States and Europe.

Despite these challenging market dynamics, Schlumberger (NYSE:SLB) management maintains confidence in the long-term fundamentals of the oil and gas industry. In North America, however, management does not anticipate a rebound in activity levels in the near future. Overall, the company expects these trends to contribute to a sustained level of global upstream investment in the coming years.