A portfolio of stocks I've been building since September 3, 2019, is named Volio. It will eventually hold 52 dividend dogs. Volio is the fifth portfolio I've built (at a one dividend dog per-week pace) since 2014. Five portfolios = V for Volio!
Today I'm reviewing the fifth of five energy sector stocks striving to join my Volio folio. This could be my twenty-sixth pick for Volio!
That energy sector includes six industries all related to bringing oil and gas to the market. They are: drilling, exploration and production (E&P), equipment and services, integrated, midstream, refining & marketing.(Those six oily and gassy enterprises.)
My subject today is a large-cap oil and gas equipment and services company named, Schlumberger Ltd. Their trading ticker symbol is SLB.This is my first report about Schlumberger Ltd (SLB).
Schlumberger Ltd is the world's largest supplier of products and services to the oil and gas industry. The company operates its business via multiple groups: Reservoir Characterization, Drilling, Production, and Cameron. The firm is investing more than any other services firm to make its offerings more bundled, which it believes is likely to be one of the key industry trends during the next 10 years. Its efforts on this front are most visible via its Schlumberger Production Management (SPM) business, which now accounts for 10% of its revenue.
The company was formerly known as Socie´te´ de Prospection E´lectrique. Schlumberger Limited was founded in 1926 and is headquartered in Houston, Texas.
I use three key data points to gauge dividend equities or funds like Schlumberger Ltd (SLB):
(1) Price
(2) Dividends
(3) Returns
Besides those three, several other keys will finally unlock an equity or fund in which to invest, or not.
Those three basic keys, however, best tell whether a company has made, is making, and will make money.
SLB Price
Schlumberger's price per share closed at $26.75 yesterday. A year ago its price was $44.35. Thus, in the past year, its market price fell to $17.60, or nearly 40%.
Assuming Schlumberger's stock trades in the range of $20 to $42 this next year, its recent $26.75 price might rise by $13.25 to reach $40.00by February 28, 2021, assuming upward price momentum reappears.
SLB Dividends
Schlumberger's latest declared quarterly dividend was $0.50 payable April 9. That $0.50Q dividend equates to an annual payout of $2.00 and yields 7.48% at yesterday's $26.75 share price.
SLB Gains?
Adding the $2.00 annual estimated dividend to my $13.25 estimate of Schlumberger Ltd (SLB) price upside shows a $15.25 potential gross gain, per share, which will be reduced by any costs to trade those shares.
Say we put a little under $1,000.00 today in Schlumberger Ltd at its recent $26.75 price, would buy 37 shares of SLB.
A $10 broker fee paid half at purchase and half at sale could cost us $0.27 per share.
Subtract that $0.27 brokerage cost from the estimated $15.25 gross estimated gain per share results in a net gain of $14.98 X 37 shares = $554.25 or a 55.5% net gain on a $989.75 investment.
Therefore, Schlumberger Ltd, whose trading ticker symbol is SLB shows a possible 55.5% net gain including a 7.48% dividend yield. It could be more, it could be less.
The above speculation is based on past year performance. The actual results remain to be seen to learn if Schlumberger Ltd (SLB), is worth your time and money.
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