Hightower's Stephanie Link is buying shares of SLB because she believes the world's largest oilfield services company is a hidden artificial intelligence beneficiary and the stock is cheap. "SLB is one of my favorite stocks for 2026," said Link in the exclusive video. "I think organic growth for the industry is going to improve this year and in the coming years. And this is tied to power demand. And this is tied to anything AI, data center buildout and grid repair." SLB shares are off to a hot start to 2026, gaining 14 precent so far this year and touching their highest levels in more than 14 months this week. The stock is getting a boost from President Donald Trump's takeover of oil resources in Venezuela, which some investors believe will lead to more demand for companies like SLB that aid in getting oil out of the ground. The stock is still down by more than half from all-time highs reached more than a decade ago. SLB 1Y mountain SLB shares, 1 year But Link's bullishness is not tied to the Venezuela narrative, it's about a company that's taken steps to improve profitability which are not yet appreciated by the market. And it has an AI tailwind to boot. Here's Link's full analysis: "SLB is one of my favorite stocks for 2026. I like it for two reasons. One, from the macro point of view, I think the industry is set to see a recovery this year and over the next couple of years. And number two, for company specific fundamentals tied to SLB." "So let's start with the macro. I think organic growth for the industry is going to improve this year and in the coming years. And this is tied to power demand. And this is tied to anything AI, data center buildout and grid repair. We know we need power for all of this. We don't have enough of it. And I think the oil field services companies will benefit." "Number two, I think international activity is set for an inflection higher in the second half of 2026. And a lot of that is because U.S. shale is actually maturing. But number two, Middle East is expected to see substantial capex improvement on a year over year basis, up 6% versus down 1% year over year." "And of course, the IOCs (integrated oil companies) wanna partner with the oilfield services companies. SLB is the best of the best." "So five fundamental reasons why I like SLB: Number one, if I'm right on international recovery, these guys will benefit because international is 81% of their revenues. Number two, they are industry leader with double digit revenue growth and EBITDA margins. Number three, they have a digital solutions business, which is a real differentiator. They have a suite of AI products that help their customers be more efficient and more productive. That gives SLB pricing power. So I expect margins to go higher and revenues to go higher. And oh by the way, recurring revenue also should improve. In the third quarter of last year, the company actually posted almost a billion dollars in recurring revenue on a trailing 12-month basis, just from this business alone. So that's pretty synergistic. Number four, they made an acquisition of ChampionX a couple of months ago. They should see $400 million in synergies. And oh, by the way, that business [is] a little less cyclical, which I like. Number five, we should see about $4 billion of shareholder returns in buybacks and dividends this year on top of last year." "So you get all of this for 15 times earnings and 8.6 times EBITDA. And the stock is still down 30 % from its 2023 highs. So I think there could be some mean reversion as well."
