Panera Brands, the parent of Panera Bread, Caribou Coffee and Einstein Bros. Bagels, said Tuesday that it was preparing for an “eventual” initial public offering, as it named José Alberto Dueñas as its chief executive officer, effective July 1. Dueñas is currently the CEO of Einstein Bros. Bagels. Current CEO Niren Chaudhary will become chairman of Panera Brands. The company also said Patrick Grismer, a former chief financial officer of Starbucks Corp.
SBUX,
and a current independent director, will become chairman of the audit committee. The company did not say when an IPO might be launched. In July 2022, a deal for Panera to go public, through the merger with a special purpose acquisition company (SPAC), was terminated, citing deteriorating market conditions.
Yelp, AutoZone, Lowe’s, Dick’s Sporting Goods & more
Cars are seen parked in front of a Dick’s Sporting Goods store at Monroe Marketplace in Pennsylvania.
Paul Weaver | SOPA Images | LightRocket | Getty Images
Check out the companies making headlines before the bell:
Yelp — Yelp shares surged 11.4% in premarket trading. Activist investor TCS Capital Management confirmed reports that it’s built a stake of more than 4% in Yelp, and is asking the company to explore strategic alternatives including a sale, according to an open letter to the Yelp board of directors on Tuesday.
AutoZone — Shares of AutoZone fell more than 2% after the specialty retailer’s third-quarter revenue came up short of expectations. AutoZone reported $34.12 in earnings per share on $4.09 billion in revenue. Analysts surveyed by Refinitiv were looking for $31.51 in earnings per share and $4.12 billion in revenue. AutoZone’s inventory increased 7.4% year over year.
Lowe’s Companies — Shares dipped about 1% after the home improvement retailer lowered its full-year forecast for total sales, comparable sales and adjusted earnings per share. However, Lowe’s beat on first quarter earnings and revenue.
Dick’s Sporting Goods — Shares of the sporting goods retailer gained more than 2% before the bell on a top-and-bottom line beat for the recent quarter. Dick’s Sporting Goods beat earnings expectations by 22 cents a share and reaffirmed its 2023 forecast.
Zoom Video Communications — Zoom declined 0.7% in the premarket after posting its first quarter results. The video conferencing firm reported adjusted earnings of $1.16, more than the expected 99 cents per share, according to consensus estimates from Refinitiv. It posted revenue of $1.11 billion, higher than revenue of $1.08 billion. However, its second quarter guidance was basically in line with expectations.
Chevron — Chevron shares rose 1.2% in the premarket. HSBC upgraded the oil giant to buy from hold, saying the stock will get a boost from rising oil prices.
BJ’s Wholesale — The wholesale retailer dipped nearly 1% before the bell. BJ’s Wholesale reported revenue that was slightly below Refinitiv estimates. Comparable club sales excluding gasoline came in slightly weaker than expected.
— CNBC’s Michelle Fox, Hakyung Kim, Jesse Pound and Samantha Subin contributed reporting
Shutterstock to buy Giphy from Meta Platforms for $53 million in cash
Shares of Shutterstock Inc.
SSTK,
rallied 4.4% in premarket trading Tuesday, after the digital media and marketing company announced an agreement to buy GIF and stickers company Giphy Inc. from Meta Platforms Inc.
META,
for $53 million in cash. Meta shares slipped 0.2% ahead of the open. As part of the deal, Meta has entered into an application programming interface (API) agreement with Shutterstock, to ensure continued access to Giphy’s content across Meta’s social-media platforms. Shutterstock said the deal, which is expected to close in June, should add “minimal revenue” in 2023. The company will fund the deal with cash-on-hand and with its revolving credit facility. The stock has tumbled 28.9% over the past three months through Monday while Meta shares of soared 44.3% and the S&P 500
SPX,
has gained 4.5%.
3 AI Stocks You Should Be Buying Hand Over Fist
Computers are excellent at executing mathematical calculations, but they fall short of human abilities in cognitive processes including understanding languages, vision, thinking, organizing and training. Both machine learning and procedural learning are examples of artificial intelligence (AI) that allows systems to perform activities that would normally need human intelligence. Accordingly, given the rise of artificial intelligence in recent months, it’s no surprise to see investors hunting for undervalued AI stocks.
In recent times, OpenAI’s ChatGPT has demonstrated the significant advancements achieved in the field of “generative AI,” which involves the creation of texts, images, sounds and ideas using artificial intelligence. The potential of such large language models is enormous, and several companies profit by selling hardware, software, services or expertise related to the technology. The following are some examples of the best AI stocks to buy.
C3.ai (AI)
C3.ai’s (NYSE:AI) shares surged following the release of its positive preliminary earnings results. According to the announcement that accompanied it, C3.ai released its initial findings for its Q4 and fiscal year that concluded on April 30.
The overall revenue for Q4 is anticipated to go above the corporate forecast, which ranges between $72.1 million and $72.4 million, as stated in the announcement. However, the company’s performance can be subject to volatility, with potential risks to consider.
C3.ai is a relatively smaller and more agile player in the AI industry, especially when compared to the big names in the sector. This makes it a potentially more lucrative investment option for investors, should the AI boom meet expectations.
Microsoft (MSFT)
Microsoft (NASDAQ:MSFT) has established a dominant position in the growing AI field, partly due to its strategic investments in OpenAI, the creator of ChatGPT with over 100 million monthly active users. The company is utilizing generative AI in its range of products and services, including Bing, which is gaining ground on Google’s stronghold in search engine dominance.
Microsoft’s new AI-powered assistant, Dynamics 365 Copilot, is generating buzz in the tech industry. It boasts advanced AI capabilities and natural language processing that enable users to turn their words into productive actions. With Copilot, users can easily create content, develop apps, and streamline workflows just by describing what they need in simple language.
Moreover, with a large stake in OpenAI, Microsoft is well-positioned at the forefront of the AI revolution. As AI capabilities continue to expand, so does the potential for Microsoft’s cloud services. In addition to enhancing its existing suite of cloud computing offerings, AI can also help Microsoft develop robust cloud security solutions, which will be crucial in protecting businesses against potential AI-related security threats.
With AI driving growth in various industries, Microsoft is poised to maintain its position as a leader. The technology is expected to accelerate growth rates for the company’s already massive business.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) has staged a remarkable comeback amid poor macroeconomic indicators, reaching a new 52-week high and getting close to its prior all-time high established in the last quarter of 2021.
Nvidia’s CEO, Jensen Huang, is an AI visionary who has steered the company towards maximizing the potential of AI milestones. Under his direction, Nvidia has emerged as a sector frontrunner and developed a track record for offering innovative solutions. Huang believes that companies are rapidly adopting cloud-first AI strategies for scalable development, which has positioned Nvidia as a leading player. In 2016, Nvidia provided OpenAI with its first supercomputers, which paved the way for the development of large language models.
Interest in AI growth stocks is currently at a peak. Despite the negative market background, there is still optimism about AI’s potential to disrupt crucial sectors of the economy. Therefore, investing in the chipmaker that provides the most high-performance AI chips is the ideal way to capitalize on this trend.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
QS Stock Forecast: Expect QuantumScape to Go Nowhere Fast
Source: rafapress / Shutterstock
What does America’s central bank have to do with electric vehicle battery technology company QuantumScape (NYSE:QS)? Actually, a lot. QS stock could continue to lose value this year because investors won’t keep throwing money at an unprofitable business.
Sure, there was a time when companies with less-than-ideal financials attracted investors. Those days are probably in the rear-view mirror now, though.
Even if QuantumScape can’t turn a profit in the near term, the company at least needs to move faster along the path to product commercialization.
Until that happens, QuantumScape’s shareholders could face more frustration and capital loss.
It’s a shame as QuantumScape is a promising company, but ultimately, investors have to understand that a business’s bottom line is, indeed, the bottom line.
The Opportunity Cost of Holding QS Stock
Even if QS stock somehow gets back to its 52-week high of $13.86, this doesn’t automatically mean QuantumScape’s investors are winners. On a longer time frame, the stock is still far below its hype-phase peak.
Plus, think about the time that’s been lost and other opportunities QuantumScape shareholders missed. Investors have been waiting for to release its forever battery that’s supposed to change the EV landscape permanently. Yet, QuantumScape’s press releases page rarely provides meaningful operation updates.
QuantumScape shipped its first 24-layer prototype battery cells to automotive manufacturers five months ago.
More recently, the company admitted that that it still has “work to do to improve reliability” as QuantumScape attempts to transition “from prototype to commercial product.” QuantumScape hasn’t provided a specific timeline for this transition, unfortunately.
Tight Monetary Policy Won’t Help QuantumScape
It might be too harsh to call QuantumScape a “walking dead” kind of company. However, QuantumScape stated that it “had not derived revenue from its principal business activities” as of March 31, and that the company’s planned “principal operations have not yet commenced.”
Meanwhile, QuantumScape’s operating expenses are growing. So, the company is spending a lot of money but still has no revenue or profits. That might have been perfectly fine a few years ago, but it isn’t anymore.
In 2023, however, the game has changed. Zero interest rate policy (ZIRP) is gone. Federal Reserve Chairman Jerome Powell recently hinted that more interest rate hikes may be imminent.
Thus, easy money has been replaced with ongoing tight-credit conditions. Certainly, it’s going to be challenging for a financially flawed startup like QuantumScape to thrive.
Don’t Expect Much From QS Stock
QuantumScape’s shareholders should insist that the company provide more frequent operational updates. QuantumScape’s management ought to release a specific action plan with a timeline to product commercialization.
It’s worthwhile to continue monitoring QuantumScape, since the company’s “forever battery” may turn out to be a game-changer. Yet, if you plan to hold QS stock, your patience will undoubtedly be tested. Therefore, you might want to explore other, more promising investment opportunities in the clean-energy space.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
The Top 7 Stocks To Buy In September 2021 (High Growth)
AAPL, META, MU, PACW and more
Apple phones on display in an Apple store on May 04, 2023 in Miami, Florida.
Joe Raedle | Getty Images
Check out the companies making the biggest moves in premarket trading:
Apple — Shares of the iPhone maker fell about 1% premarket after Loop Capital downgraded Apple’s stock to hold from buy. Loop predicts that the company will fall short of its June quarterly revenue guidance, the firm said in a note Monday.
related investing news
Meta — The social media company saw its shares dip more than 1% in premarket after news that the firm has been fined a record 1.2 billion euro ($1.3 billion) by European privacy regulators over the transfer of EU user data to the U.S. The Irish Data Protection Commission also told Meta to suspend “any future transfer of personal data” to the U.S. Meta said it would appeal the decision and the fine.
Micron Technology — Shares of the U.S. chipmaker sank more than 4% after China’s Cyberspace Administration barred operators of “critical information infrastructure” in China from purchasing products from Micron. Other chip stocks also fell, with Advanced Micro Devices shedding 1.4% and Nvidia slipping nearly 1%.
PacWest — Shares of the closely watched regional bank rose 3.5% before the bell. The bank sold $2.6 billion worth of construction loans to a Kennedy-Wilson Holdings subsidiary.
Nike, Foot Locker — Shares of Nike and Foot Locker declined 1.5% and 2.4%, respectively, in premarket trading. The move comes after Foot Locker’s lackluster results last week prompted concern over other sports apparel retailers. Foot Locker missed on the top and bottom lines in its first fiscal quarter, and lowered its guidance.
DraftKings — Shares of the sports betting stock rose about 3% before the bell. UBS upgraded shares to a buy from neutral rating, saying that expansion into new markets should fuel growth.
Norfolk Southern, CSX — Shares of the railroads added 1.8% and 1.5%, respectively, in premarket trading. Norfolk Southern was upgraded by Citi to buy from neutral, while Wells Fargo upgraded the stock to overweight from equal weight. CSX was also upgraded by Citi to buy.
Catalent — Shares of the pharmaceutical company declined 2.5% Monday morning. Catalent was downgraded by JPMorgan to neutral from overweight on Friday, with the Wall Street firm citing current productivity issues and macro headwinds among its reasons. Shares surged 15.6% during the previous trading session after the company shared a business update.
— CNBC’s Tanaya Macheel, Yun Li, Alex Harring, Hakyung Kim, Samantha Subin and Sarah Min contributed reporting.
7 5G Stocks to Buy for Blazing-Fast Growth
Fifth-generation (5G) wireless technology is igniting a digital renaissance worldwide. The sector is brimming with contenders that could potentially become juggernauts in the space. However, in selecting the best 5G stocks to buy now, it’s imperative to exercise caution. After all, with any technology, such as 5G, the potential for a robust upside is massive. Unfortunately, it can also carry strong market volatility, regulatory uncertainty, and higher valuations.
With the market in a downturn, though, plenty of undervalued 5G stocks can be picked up for long-term gains. All as the 5G wave sets up to deliver higher speeds, propelling transformative technologies from artificial intelligence to autonomous vehicles.
With that said, let’s look at the seven of the best 5G stocks to buy now.
Best 5G Stocks to Buy Now: T-Mobile (TMUS)
T-Mobile (NASDAQ:TMUS) leads the pack with its innovative deployment strategies. Its effective use of both the low-band and mid-band spectrum has paved the way for unprecedented connectivity. Its approach ensures that a massive 96% of rural Americans are within reach of 5G services, which marks a massive stride in bridging the digital divide.
Since T-Mobile first came onto the scene with its 5G services in June 2019, it has extended its coverage across thousands of cities in the U.S. Besides, its 5G Home Internet service promises high-speed, seamless connectivity, catering to a growing customer base. At the conclusion of last year, it reached a major breakthrough, bringing Ultra Capacity 5G to an impressive 260 million people. Moreover, the firm remains unfazed as it plans to invest a colossal sum between $9.4 billion and $9.7 billion in 2023, bolstering its 5G infrastructure.
Amazon (AMZN)
Amazon (NASDAQ:AMZN) has effectively carved a niche in the formidable 5G landscape thanks to its powerful Amazon Web Services (AWS) division. Its cloud network houses its Private 5G platform, promising an impressive edge as private 5G networks rise in tandem with the 5G boom. This positioning ushers for a strong outlook for long-term profitability, a thrilling prospect for discerning investors.
AWS has effectively fueled Amazon’s journey, witnessing an astonishing growth of more than 2,000% since 2013, with earnings hitting the $80 billion mark in 2022. The ever-expanding private 5G network market is expected to benefit from AWS’s proficiency, underscoring its strategic role in the space. Moreover, according to Custom Markets Insights, the private 5G sector could witness a breathtaking growth rate of 49.7% from 2023 to 2030.
American Tower (AMT)
American Tower (NYSE:AMT) commands a massive presence in the global communication infrastructure sphere, with 225,000 cell towers. Its revenue growth trajectory is nothing short of amazing, with full-year sales witnessing a 14% growth to $10.7 billion last year. On top of that, property sales followed a similar uphill journey, notching up roughly 15% to $10.47 billion.
Continuing its robust performance into the first quarter, AMT delivered yet another earnings and revenue beat. It reported sales of $2767.2 million, outstripping estimates by $27.2 million, a 4.4% increase in property revenues, and an 8.6% bump in adjusted EBITDA.
Looking ahead to 2023, American Tower aims to continue capitalizing on its globally diverse portfolio of communication infrastructure. As ongoing carrier network investments and record organic new business growth in the U.S. and Canada drive momentum, the company is in a pole position to drive the 5G wave.
Ericsson (ERIC)
Telecommunications titan Ericsson (NASDAQ:ERIC) continues to blaze trails in the 5G realm, undeterred by a massive U.S. Department of Justice penalty. Its footprint on the global 5G stage remains as strong as ever, with it commanding around 50% of worldwide 5G traffic through its involvement in 137 of 228 active networks. Additionally, it boasts more than 39% radio access network revenue share, underscoring its position as a 5G leader.
Ericsson is evolving its culture and reinforcing efficiency to fortify its 5G leadership. It is streamlining operations, aiming for a leaner, more agile workforce, with plans to cut 8,500 positions. The goal is to significantly lower more than $880 million in costs by the year’s close. These developments, marking a strategic pivot, are set to propel Ericsson’s operating margins well beyond their historical averages.
Nokia (NOK)
Former smartphone giant Nokia (NYSE:NOK) has effectively staged an extraordinary transformation. Under the guidance of CEO Pekka Lundmark, Nokia has established its position as a leading telecommunications player, setting the pace in the lucrative 5G landscape. Its resurgence is attributable to its effective execution, capital allocation, and the massive potential of its market.
Punctuating Nokia’s success is an enviable track record of securing promising deals, serving as the bedrock for its impressive revenue growth. This has resulted in a remarkable tally of more than 286 commercial 5G agreements. Furthermore, its resurgence manifests in its stellar top and bottom-line growth figures, marked by double-digit improvements over the past year. As we advance, it targets full-year sales growth between 2% and 8% in 2023. NOK stock trades at just 0.8 times trailing twelve-month sales, which is 70% lower than the sector median.
Marvell Technologies (MRVL)
Marvell Technologies (NASDAQ:MRVL) has established its position as a data infrastructure semiconductor solutions provider, underpinning high-speed 5G connectivity across a broad. It’s a critical pillar supporting the infrastructure and networks of 5G wireless, making MRVL stock a compelling choice.
Moreover, the firm’s innovative streak stretches beyond 5G. It also pioneers technologies leveraged in AI, drones, and cloud computing. Its multifaceted involvement in these interconnected, high-growth fields positions it as an exciting long-term option. Its fundamentals are remarkably strong, with its 5-year revenue and EBITDA growth at 20% and roughly 36%. Additionally, its levered free cash flows have grown by a whopping 228% over the same period. It isn’t the cheapest 5G stock by any stretch, trading at over seven times forward sales estimates, with a yield of more than 0.5%.
Corning (GLW)
Corning (NYSE:GLW) is uniquely positioned in the 5G realm, excelling in producing fiber optic cables, the critical components needed to address 5G’s speed and capacity needs. Last year, Corning made waves, unveiling its robust TXF fiber that achieved a transmission rate of 800 gigabits per second over 800km. This robust innovation holds vast potential for long-haul transmissions, poised to revolutionize many industries.
While the recent quarters may have painted a slower picture due to challenges in the Chinese market, the outlook remains spectacular. As the macroeconomic headwinds recede, Corning’s is anticipated to regain momentum. Moreover, a key element for Corning is its rock-solid dividend profile, boasting 12 years of consecutive growth and an appealing dividend yield of more than 3%. For investors eyeing the 5G horizon, Corning’s distinctive offering is an intriguing prospect worth considering.
On the publication date, Muslim Farooque did not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
7 Overvalued Energy Stocks to Sell Before June 2023
It may be time to sell some of the top energy stocks, especially as they become overvalued. Sure, according to the International Energy Agency, rising post-Covid demand from China, coupled with tight supply, suggests that a crude oil rebound is possible later this year. However, U.S.-driven factors such as debt ceiling uncertainty and continued interest rate hikes from the Federal Reserve may outweigh this, possibly pushing Light Sweet Crude prices (now in the low-$70s per barrel) to even lower prices. Having said that, it’s not as if all energy stocks are in for a big drop, if oil prices tumble again.
Conversely, it’s not as if all names in this space have big room to run, if oil has yet another rebound. With these seven energy stocks to sell now, risk/return is not in your favor. Each one is relatively overvalued, with company-specific issues that further bolster their respective bear cases.
| COP | ConocoPhillips | $103.73 |
| CVX | Chevron | $152.44 |
| HES | Hess | $133.08 |
| INT | World Fuel Services | $23.49 |
| OXY | Occidental Petroleum | $59.04 |
| RIG | Transocean | $6.33 |
| SLB | Schlumberger | $46.00 |
ConocoPhillips (COP)
On the surface, it may sound odd to consider ConocoPhillips (NYSE:COP) an overvalued stock. Shares in this oil and gas giant trade for 8.2 times trailing twelve-month earnings. However, keep in mind that energy prices are lower than they were for most of 2022. With this, it’s likely better to use forward valuation when it comes to determining whether COP stock is overvalued or undervalued. Based on sell-side forecasts, COP trades for 10.4 times forward earnings. Yes, compared to most stocks, this sounds like a low valuation.
But when you compare ConocoPhillips to peers, this valuation may make COP one of the overvalued energy stocks. Alongside this, as Mizuho’s Nitin Kumar argued back in April, it may prove difficult for the company to live up to its 10-year outlook. The analyst even added there are more attractive opportunities out there among large energy stocks.
Chevron (CVX)
Chevron (NYSE:CVX) is held by Warren Buffett’s Berkshire Hathaway’s (NYSE:BRK-A) (NYSE:BRK-B) portfolio of publicly-traded stocks.
Yet with the “Oracle of Omaha” paring down Berkshire’s CVX stock position by 20% last quarter, the integrated oil and gas giant’s shares may be losing this Buffett seal of approval. The answer to this question is somewhat unclear. The legendary investor hasn’t made any public statements signaling why Berkshire is reducing its stake. Then again, as a Seeking Alpha commentator recently argued, it makes sense why Buffett is making an exit. Mainly, because CVX’s cash flow generation does not justify its current valuation (8.3 times TTM earnings). On purely valuation grounds, you may want to consider Chevron as one of the energy stocks to sell now.
Hess (HES)
While it’s possible I’m splitting hairs about the valuations of COP and CVX, it’s clear that oil and gas exploration and production company Hess (NYSE:HES) sports a rich multiple for an energy stock. HES stock currently trades for nearly 20 times TTM earnings. Based on 2023 earnings forecasts, Hess appears even more pricey, with a forward multiple of 28.7. Yes, there is a reason why HES has become one of the more overvalued energy stocks. As InvestorPlace’s Faisal Humayun pointed out in April, there is big potential with the company’s Guyana exploration projects.
In the coming years, the development of these assets could result in massive profitability growth. Even so, with this potential upside largely priced in, shares may have little room to run from here. Likewise, if crude oil prices fall again, revisions to future earnings forecasts may push HES to much lower prices.
World Fuel Services (INT)
Based in Miami, Florida, World Fuel Services (NYSE:INT) is a marketer/wholesaler of aviation, marine, and ground transportation fuel. Analysts expect INT’s earnings to grow at a steady clip between this year and 2025. Two years from now, the company could earn $3.01 per share. Not too shabby, given the current INT stock price ($23.50 per share). Then again, maybe not. There is likely a high level of uncertainty behind future earnings forecasts for World Fuel Services.
The company has a history of growth via acquisitions. Increasing earnings by 65% from 2022 may hinge too heavily on more successful dealmaking. The post-Covid boom times for aviation could also come to an end if the economic slowdown worsens. This too could weigh on INT’s future results.
Occidental Petroleum (OXY)
Warren Buffett may be bailing on Chevron, but it’s a different story with Occidental Petroleum (NYSE:OXY). Berkshire continues to buy more shares in the E&P company. Buffett’s firm now owns nearly 25% of it.
However, at just under $60 per share, it’s questionable whether OXY stock is a bargain. Shares now trade at the higher end, valuation-wise, among E&P stocks, with forward earnings multiple of 12. Occidental Petroleum’s latest quarterly results also fell short of expectations.
The “Buffett factor” may be helping to keep OXY elevated, but it’s questionable how much longer this can continue. As InvestorPlace’s Joel Baglole argued earlier this month, as Buffett is not interested in buying the company outright, outside of an unforeseen spike in crude oil prices back to 2022 highs, it’s easy to see the energy stocks bubble that has emerged with OXY deflating from here.
Transocean (RIG)
Transocean (NYSE:RIG) traded below $1 per share during 2020, as the pandemic-driven collapse in oil prices dried up demand for the contract drilling firm’s services. Since oil’s epic comeback in 2021, however, RIG stock has rallied by more than six-fold. Yet while the oil and gas landscape has improved tremendously, it’s not as if this company has already pulled off a big recovery, in terms of its operating performance.
Transocean reported net losses last year and is expected to remain in the red for 2023. Even as analyst forecasts call for the company to report positive earnings in 2024 and 2025, an additional drop in energy prices may mean results fall short of current expectations. All of this points to RIG being one of the energy stocks to avoid. Any bit of disappointment could send it sinking back to penny stock territory (under $5 per share).
Schlumberger (SLB)
Unlike Transocean, Schlumberger (NYSE:SLB) is an oil services company that has been consistently profitable recently. Yet while this stock may have less uncertainty than turnaround play RIG, it’s possible that investors have pushed SLB to too high of a valuation.
SLB stock today trades for 16.8 times TTM earnings, and 15.1 times forward earnings. Admittedly, SLB has historically traded for between 12 and 20 times earnings, during times of steady profitability. Still, shares could slip down to the lower end of this valuation range, if bullishness for the stock cools from here.
Something that could dampen enthusiasm may be the prospect of stagnant oil prices. As InvestorPlace’s Larry Ramer argued earlier this month, this could impact Schlumberger’s growth prospects. In turn, resulting in a de-rating for shares. Although downside risk may not be very high, consider SLB one of the energy stocks to sell now.
On the date of publication, Thomas Niel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
