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Oilfield services companies have been generating big profits over the past three years due to the increase in drilling and production activities. This has further resulted in a very strong demand for oilfield services companies because they provide the technology, products and information solutions to the oil and gas industry worldwide.

SLB is among the oilfield services companies that have set very strong footholds to keep capitalizing on the demand for oilfield products and services. Schlumberger has a diversified business model operating in three business segments including reservoir Characterization, production and drilling segments.

In addition to that, it has extensive global foot-prints with aroundemployees working in over 85 countries.

Its reservoir characterization business segment provides technologies including wireline services and softwares to customers that reduces sub-surface risk and improves well production.

Their drilling technologies enhances drilling efficiency, optimize well placement and assure wellbore integrity and production group provides new production group technologies, enhances operational efficiencies, maximize reservoir recovery and accelerate production.

Strong growth in sales was led by its wireline services, seismic activity, pressure pumping and completions as well as the software sales which are also rising.

Additionally, with the latest technologies and services in its portfolio combined with enhanced operational efficiencies, the company is getting higher margins on its sales. A massive surge in its share price clearly tells us that the company remains successful in enhancing investors' confidence in its worldwide operations, innovative technologies and strong financial performance. However, the stock is on a dip with the recent market correction and the fall in prices.

Amidst all this, I believe this presents an attractive opportunity to initiate a position in a company because the market fundamentals look strong to me as the overall global economic outlook continues to stabilize.

Moreover, it will be helped european put option payoff the US recovery which was affected by the harsh weather conditions and it is anticipated that the U. Europe, Africa, CIS and Russia are also showing recovery from the effects of winter season.

Both drilling and is schlumberger a good stock to buy activity in the key markets of Saudi Arabia and Australia has been increasing. Furthermore, Schlumberger seems to be morphological operations on binary image matlab code a buying zone.

This is based on its price to earnings ratio of 21 which is well below the industry average of Also, SLB's high forward price to earnings ratio of On the other hand, its closest industry peers including Halliburton Company NYSE: HAL and Baker Hughes NYSE: BHI are also producing strong growth with favorable business environment. However, Schlumberger has ability to convert higher revenue growth how much did andy murray wins in wimbledon higher profits compared to these two closest industry peers.

In the past three year, Schlumberger has generated One more advantage of buying and holding SLB's stock is its dividends and high dividend yield compared to the peers. The company has been regularly increasing its dividends at a high rate.

The company's cash generating potential looks strong enough to support increasing dividends. The huge gap between dividend payments and free cash flow offers a lot of room for potential dividend increases. I believe SLB will make another increase in dividends as it has a history presidential election year stock market performance making increases in its dividends in the first quarter of each year.

And, its free cash flows are offering a room for potential increases.

Additionally, a strong cash generating potential allows it to keep reducing outstanding shares which further enhances its earnings per share and dividends. Schlumberger has set very strong footholds for future growth with its extensive footprint and innovative products and technologies. The demand for oilfield services is consistently increasing due to the increased drilling and production activities.

Overall, the long-term fundamentals for the oil field services companies look strong. The only risk Schlumberger has been facing is worse weather conditions which are beyond its control. Schlumberger is in a sound financial and cash position. Thus, it is expected to generate double digit growth in earnings and its dividends also look sustainable. Therefore, I believe the dip in its share price presents an attractive buying opportunity.

Schlumberger Limited (SLB) Stock Is Damaged Goods For Now | InvestorPlace

The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. The author wrote this article themselves, and it expresses their own opinions.

The author is not receiving compensation for it other than from Seeking Alpha.

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Is Schlumberger A Good Stock To Buy? Summary Oilfield services companies are gaining momentum. Schlumberger is well set to capitalize on the increasing demand. Schlumberger is a good stock to buy and hold. Want to share your opinion on this article? Disagree with this article? To report a factual error in this article, click here. Follow Winning Strategies and get email alerts.