Schlumberger rose 4.02% to $37.69 following Morgan Stanley analyst Connor Lynagh's upgrade to overweight from equal-weight with a price target of $51.
He offered three factors for the improved upgrade:
- Enhanced focus on returns and free cash flow under new CEO Oliver Le Peuch, who joined the company Aug. 1
- Global capital expenditure dynamics favoring international exposure
- Downside support via dividend, noting that he thinks the current dividend is sustainable "in all but the worst oilfield market scenarios"
In his upgrade message, Lynagh described Schlumberger's risk-reward as the most compelling it has been in years.
The company reported a 14.4% increase in quarterly profit for the second quarter, which ended in June, as demand in international markets helped it counter weakness in North America. Net income rose to $492 million, or 35 cents a share, from $430 million, or 31 cents a share, a year earlier.