Core Laboratories Earnings Summary - Core Laboratories reported quarterly earnings of $0.25 per share, matching the Zacks Consensus Estimate, and an increase from $0.22 per share a year ago [1] - The company achieved revenues of $134.4 million for the quarter ended September 2024, exceeding the Zacks Consensus Estimate by 1.27% and up from $125.34 million year-over-year [1] Earnings Performance - Over the last four quarters, Core Laboratories has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [1] - The company had a surprise of 4.76% in the previous quarter, with actual earnings of $0.22 per share against an expected $0.21 [1] Future Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.28 on revenues of $137.2 million, and for the current fiscal year, it is $0.93 on revenues of $530.12 million [4] - The estimate revisions trend for Core Laboratories is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [4] Industry Context - The Oil and Gas - Field Services industry, to which Core Laboratories belongs, is currently in the bottom 41% of over 250 Zacks industries, which may impact stock performance [5] - KLX Energy Services, another company in the same industry, is expected to report a quarterly loss of $0.48 per share, reflecting a year-over-year change of -194.1% [5]

Revenue and Income - Third quarter 2024 revenue was $134.4 million, up 3% sequentially and over 7% year-over-year[1] - Revenue for Q3 2024 was $134,397,000, representing a 2.9% increase from Q2 2024 and a 7.2% increase from Q3 2023[19] - Operating income for the third quarter was $19.8 million, with ex-items operating income of $18.2 million, up 11% sequentially and 14% year-over-year[1] - Operating income for Q3 2024 reached $19,803,000, a 23.7% increase from Q2 2024 and a 35.0% increase from Q3 2023[19] - Net income attributable to Core Laboratories Inc. was $11,745,000 for Q3 2024, reflecting a 30.0% increase compared to Q3 2023[19] - Operating income for the nine months ended September 30, 2024, was $44,382,000, a 10.8% increase from $40,059,000 in 2023[20] - Net income for the nine months ended September 30, 2024, was $24,684,000, a decrease of 28.7% from $34,591,000 in 2023[22] Cash Flow and Expenditures - Free cash flow for the third quarter was $10.4 million, with cash from operations at $13.1 million and capital expenditures at $2.7 million[9] - Net cash provided by operating activities increased significantly to $35,773,000 from $5,360,000 year-over-year[22] - Free cash flow for the nine months ended September 30, 2024, was $27,126,000, compared to $0 for the same period in 2023[30] - Capital expenditures for the nine months ended September 30, 2024, were $8,647,000, up from $7,843,000 in 2023[22] Debt and Financial Ratios - The company reduced net debt by $11.8 million, achieving a debt leverage ratio of 1.47, the lowest in over six years[2] - Long-term debt decreased to $139,872,000, down 5.2% from $147,621,000 in Q2 2024[21] - The company reported a significant reduction in long-term debt repayment to $62,000,000 from $184,000,000 year-over-year[22] - The company's return on invested capital (ROIC) as of September 30, 2024, was 8.6%[12] - The company reported a return on invested capital (ROIC) of 8.6%, calculated from a net operating profit after tax (NOPAT) of $34.9 million[28] Segment Performance - Reservoir Description segment revenue was $88.8 million, up 3% sequentially and over 4% year-over-year, with operating margins of over 17%[3] - Production Enhancement segment revenue was $45.6 million, up 3% sequentially and over 13% year-over-year, with operating margins of 6%[6] - Fourth quarter 2024 revenue guidance for Reservoir Description is projected to range from $87.5 million to $90.5 million[15] - Fourth quarter 2024 revenue guidance for Production Enhancement is estimated to range from $41 million to $45 million[15] Assets and Cash Position - Cash and cash equivalents increased to $21,474,000 as of September 30, 2024, up 21.4% from $17,695,000 in Q2 2024[21] - Total assets as of September 30, 2024, were $600,466,000, a 0.4% increase from $597,799,000 in Q2 2024[21] - Total cash and cash equivalents at the end of the period increased to $21,474,000 from $16,616,000 in the prior year[22] Earnings Per Share and Tax Rate - Diluted earnings per share for Q3 2024 were $0.25, a 31.6% increase from $0.19 in Q3 2023[19] - The diluted earnings per share attributable to Core Laboratories Inc. for the three months ended September 30, 2024, was $0.25, consistent with the previous quarter[25] - Effective tax rate for Q3 2024 was 28%, compared to 20% in Q3 2023[19] Future Outlook - Core anticipates continued growth in international project activity, with crude-oil demand expected to rise between 1.0 and 1.6 million barrels per day for 2025[13]

Core Insights - The third quarter of 2024 earnings results for oil and energy companies have shown better-than-expected outcomes despite declining commodity prices [1] - Several companies have surpassed earnings forecasts, leading to a more optimistic outlook for the sector [1] Commodity Price Impact - Oil prices in Q3 2024 declined compared to the previous year, with average monthly prices for West Texas Intermediate crude at $81.80, $76.68, and $70.24 per barrel in July, August, and September respectively, down from $76.07, $81.39, and $89.43 [2] - Natural gas prices also faced pressure, averaging $2.07, $1.98, and $2.28 per MMBtu in July, August, and September, down from $2.55, $2.58, and $2.64 in the same months last year [2] China's Economic Influence - China's economic slowdown has significantly contributed to the decline in oil prices, as it is the world's largest crude oil importer [3] - Weak economic indicators in China, including low inflation and sluggish consumer demand, have raised concerns about its oil consumption levels [3] Resilience of Energy Firms - Despite challenges, a notable percentage of energy firms have exceeded analyst expectations, with 48 S&P 500 members reporting a 5.2% year-over-year increase in total earnings and a 4.9% rise in revenues [4] - Approximately 81.3% of these firms have beaten EPS estimates, and 72.9% have surpassed revenue projections, indicating potential investment opportunities [4] Stocks with Earnings Beat Potential - Identifying stocks with the potential to outperform is crucial for investors, with a positive Earnings ESP and a Zacks Rank of 1, 2, or 3 increasing the likelihood of a positive earnings surprise [5] Promising Energy Stocks - ProPetro Holding Corp. (PUMP) has a Zacks Rank of 3 and an Earnings ESP of +60%, primarily operating in the Permian Basin [6] - Core Laboratories N.V. (CLB) holds a Zacks Rank of 3 with an Earnings ESP of +2.63%, providing reservoir management and production enhancement services [7] - Oceaneering International (OII) has an Earnings ESP of +2.27% and a Zacks Rank of 3, supplying offshore equipment and technology solutions [7] Conclusion - The Q3 2024 earnings season has revealed both challenges and opportunities for energy investors, with several companies demonstrating stronger-than-expected results [8] - Focusing on stocks with potential for positive earnings surprises, such as ProPetro Holding, Core Laboratories, and Oceaneering International, may allow investors to capitalize on post-earnings momentum [8]

Core Insights - Core Laboratories Inc. (CLB) is expected to report third-quarter earnings on October 23, with a consensus estimate of 25 cents per share and revenues of $132.71 million [1] - The company reported adjusted earnings of 22 cents per share in the last quarter, exceeding the consensus estimate by 5 cents, driven by strong performance in the Reservoir Description segment [3] - The Zacks Consensus Estimate for third-quarter 2024 earnings indicates a 13.64% year-over-year increase, while revenues are expected to rise by 5.88% compared to the previous year [4] Financial Performance - CLB's revenues for the third quarter are projected to increase to $133.1 million, up from $130.6 million in the previous quarter, largely due to the Reservoir Description segment's performance [6] - Operating income is anticipated to remain strong, supported by effective cost management and a focus on high-margin services [7] - The company's costs of services and product sales are expected to decrease to $102.4 million, with general and administrative expenses projected to drop from $10.3 million to $9.9 million [8] Strategic Initiatives - CLB's strategic use of digital technologies is likely to enhance performance by streamlining operations and reducing costs through automation [9] - The company is expected to achieve an earnings beat this season, supported by a positive Earnings ESP of +2.63% and a Zacks Rank of 3 [10]

Core Laboratories Overview - Core Laboratories (CLB) is positioned well to potentially beat earnings estimates in its upcoming quarterly report, continuing its solid history of performance in the Zacks Oil and Gas - Field Services industry [1][4] Earnings Performance - The company has a strong track record of exceeding earnings estimates, with an average surprise of 11.76% over the last two quarters [2] - In the last reported quarter, Core Laboratories achieved earnings of $0.22 per share, surpassing the Zacks Consensus Estimate of $0.21 per share, resulting in a surprise of 4.76% [3] - For the previous quarter, the company was expected to earn $0.16 per share but delivered $0.19 per share, yielding a surprise of 18.75% [3] Earnings Estimates and Predictions - Recent estimates for Core Laboratories have been trending upward, indicating positive sentiment among analysts [4] - The Zacks Earnings ESP (Expected Surprise Prediction) for the company is currently positive at +2.63%, suggesting bullish expectations for near-term earnings [7] - Stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have historically produced positive surprises nearly 70% of the time [5] Upcoming Earnings Report - Core Laboratories is expected to release its next earnings report on October 23, 2024 [7]

Core Viewpoint - Core Laboratories Inc. (CLB) has shown strong performance in the oilfield services sector, with a year-to-date share price increase of 13.9%, outperforming the broader oil and energy sector's growth of 8.2% [1][2] Financial Performance - The Zacks Consensus Estimate projects CLB's earnings per share to be 95 cents for 2024 and $1.33 for 2025, indicating year-over-year growth of 18.75% and 39.65% respectively [3][4] - In the second quarter of 2024, CLB reported an operating income of $16.4 million, a 10% sequential increase, and free cash flow of $14.3 million, while reducing net debt by $15.8 million [5][9] Revenue Growth - CLB's sales are projected to reach $531.72 million in 2024 and $573.88 million in 2025, reflecting year-over-year growth of 4.3% and 7.93% respectively [6][7] - Approximately 80% of CLB's revenues are generated from international markets, with the Reservoir Description segment's revenues growing 3.5% year-over-year in Q2 2024 [7] Market Trends - The company anticipates continued growth in international markets, driven by increased investments in oil fields and a projected rise in crude oil demand of 1-2 million barrels per day in 2024 and 2025 [6][7] Competitive Advantage - CLB is leveraging advanced technologies such as Dual Energy Computed Tomography and HERO-oriented FRAC technology to enhance production and optimize well productivity, providing a competitive edge [8] - The company's asset-light business model has resulted in a return on invested capital (ROIC) of 8%, allowing it to maintain profitability even during lower capital expenditure periods [10] Investment Consideration - Given the positive trends in financial performance, revenue growth, and competitive positioning, CLB stock presents an attractive entry point for investors, currently trading 20% lower than its 52-week high [11]

Core Viewpoint - OPEC's 'World Oil Outlook' presents a bullish forecast for oil demand, asserting that oil and gas will remain essential to global energy until 2050, suggesting a long-term buying opportunity for investors in the sector [1][2] Demand Growth in the Foreseeable Future - OPEC predicts global oil demand will rise from 102.2 million barrels per day (bpd) in 2023 to 120.1 million bpd by 2050, contrasting with the IEA's forecast of a peak at 105.6 million bpd by 2029 [2] Renewables and Energy Transition - OPEC acknowledges the growth of renewables but maintains that oil will still account for approximately 29.3% of the global energy mix by 2050, only slightly down from 30.9% today [3] Contrasting Supply Projections - OPEC anticipates $17.5 trillion in investment needed for oil production to meet future demand, with OPEC+ expected to control 52% of global production by 2050 [4] Emerging Markets: New Engine of Oil Growth - India is projected to contribute 8 million bpd to the expected demand increase by 2050, with non-OECD countries expected to offset declines in developed nations' oil consumption [6] The Road Ahead - OPEC's long-term outlook suggests that oil-focused stocks will remain attractive, particularly due to rising demand from emerging markets and consistent upstream investments [7] 3 Oil/Energy Stocks to Buy - Recommended stocks include Core Laboratories (valued at $5.2 billion), TechnipFMC (valued at $11.4 billion), and Tullow Oil (valued at $555.2 million), with significant projected earnings growth for each [8][9]

Group 1 - Core Laboratories (CLB) has shown a year-to-date return of approximately 3.6%, outperforming the average gain of 2.6% in the Oils-Energy sector [4] - The Zacks Consensus Estimate for CLB's full-year earnings has increased by 8.4% over the past quarter, indicating a positive trend in analyst sentiment [4] - Core Laboratories is ranked 2 (Buy) in the Zacks Rank system, which focuses on stocks with improving earnings outlooks [3] Group 2 - Core Laboratories is part of the Oil and Gas - Field Services industry, which has seen an average loss of 8.6% this year, highlighting CLB's relative strength in this area [6] - In contrast, Talen Energy Corporation (TLN), another stock in the Oils-Energy sector, has significantly outperformed with a year-to-date return of 167.2% and a Zacks Rank of 1 (Strong Buy) [5] - The Oils-Energy sector is ranked 16 in the Zacks Sector Rank, which includes 16 different groups [2]

Group 1 - Core Laboratories (CLB) has experienced significant selling pressure, resulting in a 10.1% decline in stock price over the past four weeks, but analysts expect better earnings than previously predicted [1] - The stock is currently in oversold territory, indicated by an RSI reading of 29.36, suggesting a potential reversal in trend [3] - Over the last 30 days, the consensus EPS estimate for CLB has increased by 9.2%, indicating a positive outlook for earnings and potential price appreciation [3] Group 2 - CLB holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a turnaround [3]

Company Overview - Core Laboratories N.V. is an oilfield services company founded in 1936, based in Amsterdam, Netherlands, operating in over 50 countries [11] - The company provides reservoir management and production enhancement services to oil and gas companies, with operations in regions including the United States, Europe, Africa, Middle East, Asia Pacific, Canada, Russia, and Latin/South America [11] - Core Laboratories generated revenues of $509.8 million in 2023 [11] Investment Ratings - Core Laboratories holds a Zacks Rank of 2 (Buy) and has a VGM Score of A, indicating strong investment potential [12] - The company has a Value Style Score of B, supported by attractive valuation metrics such as a forward P/E ratio of 20.66, making it appealing to value investors [12] Earnings Estimates - For fiscal 2024, one analyst has revised their earnings estimate upwards in the last 60 days, with the Zacks Consensus Estimate increasing to $0.95 per share [12] - Core Laboratories has an average earnings surprise of 3.5%, suggesting a history of exceeding earnings expectations [12] Conclusion - With a solid Zacks Rank and top-tier Value and VGM Style Scores, Core Laboratories is recommended for investors' consideration [13]