Raymond James raised its price objective for SLB to $57.00 from $52.00 and reiterated an Outperform rating following the oilfield services firm's robust quarterly performance. The stock is trading near recent highs at $49.15 and sits close to its 52-week peak of $51.67; analyst price targets across the street range from $38 to $74. Over the last six months, SLB has produced a strong return of 40.78%.
Company results for the fourth quarter of 2025 showed a healthy top-line outcome, anchored by outsized contributions from the Digital and Production Systems segments. Those businesses helped the quarter deliver a low-single-digit EBITDA beat versus consensus. For the trailing twelve months, SLB recorded $35.71 billion in revenue along with a gross profit margin of 18.69%.
Free cash flow was a notable strength in the quarter, coming in at roughly $2.3 billion. That quarterly performance pushed fiscal 2025 free cash flow above $4 billion, enabling SLB to meet its pledge to return an equivalent amount to shareholders. Over the last twelve months the company generated $3.68 billion of levered free cash flow, equating to an approximate 6% free cash flow yield on current pricing.
On the operational outlook, SLB expects the first quarter of 2026 to be sequentially softer after the strong fourth quarter of 2025, though full-year 2026 revenue and EBITDA guidance are in line with market expectations. Street models that follow the company translate into analyst forecasts of about 4% revenue growth for fiscal 2026 and an EPS projection of $2.87.
Capital allocation and returns were also highlighted. Management set a conservative capital expenditure budget of $2.5 billion for fiscal 2026 - a modest rise versus 2025 despite the inclusion of a full year of ChampionX results - and announced a 3.5% increase to its quarterly dividend. The firm has increased its dividend for four consecutive years and has maintained dividend payments for 56 years, with the current yield around 2.4%.
On financial health, SLB posts an overall score of 3.14 out of 5 under commonly used metrics, characterized here as "GREAT," and operates with moderate levels of debt. The company’s liquidity and cash generation position underpinned management’s capacity to deliver shareholder returns while keeping capital spending restrained.
Looking at the headline quarterly numbers, SLB beat earnings and revenue expectations in Q4 2025. The company reported earnings per share of $0.78, outpacing a consensus forecast of $0.74, and revenue of $9.75 billion compared with a projected $9.55 billion.
Those results prompted several firms to lift their price targets. BMO Capital increased its target to $55 from $53 and retained an Outperform rating, citing the strong earnings and revenue. BofA Securities moved its price target to $55 from $50, drawing attention to international revenue gains, particularly in the Middle East and Saudi Arabia. RBC Capital raised its target to $54 from $51, highlighting SLB’s strong free cash flow generation and noting an adjusted EBITDA of $2.33 billion that slightly exceeded street expectations.
Collectively, the earnings beat, free cash flow strength and incremental analyst target increases reflect a constructive near-term view of SLB’s operating momentum and capital return capacity. That said, management has signaled a moderation in sequential activity to begin 2026 while maintaining full-year guidance that aligns with the consensus.
What this means for markets and sectors
- Energy and oilfield services investors are likely to focus on SLB’s free cash flow yield, dividend trajectory and modest capex plan as indicators of disciplined capital allocation.
- Regional oil and gas activity, including growth in the Middle East and Saudi Arabia, is a factor referenced by analysts when reassessing revenue prospects.
- Equity analysts adjusted valuations and price targets upward in response to stronger-than-expected operational results and cash generation.
Bottom line
SLB’s fourth-quarter performance and strong free cash flow profile prompted multiple analysts to lift price targets, with Raymond James moving its target to $57 while keeping an Outperform rating. The company’s cautious capex plan for 2026, sustained dividend increases and the announced beat on both EPS and revenue underpin a broadly positive sentiment among analysts, even as management cautions that the opening quarter of 2026 should be softer sequentially.