Oil services company Schlumberger beats on earnings, raises dividend

Yahoo Finance Live's Julie Hyman and Brian Sozzi discuss first quarter earnings for oil services company Schlumberger.

Video Transcript

BRIAN SOZZI: Let's switch gears to Schlumberger, really another oilfield services company, like we heard from Halliburton earlier in the week. A good quarter and warning about continued tightness in the oil market. Schlumberger of course, hiking its dividend as well by a whopping 40%, just given this fertile backdrop for the likes of these oilfield services companies. But again, a big quarter by Schlumberger.

JULIE HYMAN: Yeah. And what's interesting to me about Schlumberger as well, the assumption would have been that the disruption of the oil business in Russia would create all kinds of interesting ripple effects across the market. What seems to have happened that has benefited Schlumberger is that because of that crimping of supply in one place, we're seeing an increase, potentially, in drilling activity elsewhere. And that's good for an oilfield services company like Schlumberger, so an increased demand for its services.

So that seems to be sort of a displaced demand equation here that is helping Schlumberger, which I thought was quite interesting. $0.34 a share, by the way, was the number for earnings per share that beat estimates. And sales were up the most since late 2017 to nearly $6 billion.

So that's how that demand translated and then as well translated into that dividend increase. We've talked about it before, although usually we talk about it with the exploration and production companies. But one of the main sort of reasons to own, for many investors, many of these large energy companies has historically been the dividends. It hasn't hurt that the stocks have also done really well over the past year, as we've seen oil prices climb, Soz.

BRIAN SOZZI: No, yeah. Some of the results from these oil companies should be looking quite bumper over the next few weeks.