Munger Mode rating: 2 out of 5 — Sell. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
We have spent our lives looking for businesses that get stronger every year without anyone having to sweat for it — businesses where the economics do the compounding. SLB is not that kind of business. It is, by a wide margin, the best company in its industry: the largest oilfield services firm on earth, technologically superior, competently managed, internationally entrenched. But being the best house in a tough neighborhood is not the same as owning a wonderful business. SLB's earnings are a derivative of its customers' capital spending, which is itself a derivative of the oil price, which is set by a cartel and a commodity cycle that neither SLB nor anyone else controls. Over the past decade the company wrote off tens of billions of dollars of acquisitions, cut its dividend 75% in 2020, and earned returns on capital that averaged out to mediocre across the full cycle.
Recent filings analysed: 10-Q (2026-07-29), 8-K (2026-07-24), 8-K (2026-06-10), 8-K (2026-05-12).
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