SLB (SLB) has drawn fresh attention after announcing a new alliance with Liberty Energy to supply modular infrastructure and integrated power solutions for AI focused data centers around the world.

The new AI focused data center alliance comes after a period where SLB’s 1 month share price return is down 11.29% and the 3 month share price return is down 10.60%. However, the year to date share price return is up 17.11% and the 1 year total shareholder return is 39.50%, which points to longer term momentum that contrasts with recent weakness.

If you see SLB’s move into AI infrastructure as part of a broader energy and compute shift, it may be worth scanning other AI infrastructure opportunities using the 53 AI infrastructure stocks

SLB now trades well below both analyst targets and an intrinsic value estimate, even after years of solid total returns and new contracts in subsea and AI infrastructure. Is this discount compensation for real risks, or is the market overpricing caution and creating an opportunity?

Most Popular Narrative: 23.3% Undervalued

SLB's most followed valuation narrative points to a fair value of $61.39, compared with the latest close at $47.08. This frames the current AI and energy expansion story as leaving meaningful upside on the table according to that model.

The integration of ChampionX expands SLB's capabilities in production optimization, chemicals, and digital production technology, unlocking new revenue synergies through cross-selling and international expansion, while also driving significant cost synergies ($400 million targeted). All of these factors are expected to increase EBITDA margins and earnings per share, notably in 2026 and beyond.

Want to see what sits behind that margin uplift and earnings trajectory for SLB? The fair value hinges on a specific revenue glide path, rising profitability and a future earnings multiple that many investors usually associate with faster growing sectors. Curious which of those levers the narrative stretches most aggressively, and which assumptions stay conservative? The full narrative lays out those building blocks in black and white.

Result: Fair Value of $61.39 (UNDERVALUED)

However, SLB's narrative still faces pressure if global upstream spending declines as anticipated in 2025, or if the ChampionX integration delivers slower or lower synergies.

Next Steps

Given the mix of optimism and concern running through SLB’s story, it may be helpful to move quickly and evaluate the trade off for yourself using the 4 key rewards and 2 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.