Weatherford (NYSE:WFT), Halliburton (NYSE:HAL), Schlumberger (NYSE:SLB) Top Oil Services Large Cap Picks

Based largely on spending metrics, Barclays (NYSE:BCS) is bullish on the oil service and drilling industry, with their favorite large cap picks including Weatherford (NYSE:WFT), Halliburton (NYSE:HAL) and Schlumberger (NYSE:SLB).

Barclays said, "The results of our semiannual 'Original' E&P Spending Survey support our bullish stance on the oil service and drilling industry. International E&P spending is estimated to rise 12% in 2011 and we believe the industry is in the early stages of a long international upcycle. In North America the spending survey suggests an increase in E&P spending in the mid to high single digits for 2011.

"Given our strong growth expectations for the oil service and drilling industry relative to the global economy over the next two-to-three years, we believe the oil service stocks should command a considerable premium to the market. As a result, we are raising our target multiple for the group to a 20% premium (up from 10%) on 2012 earnings versus the S&P 500. For the major oil service companies we are also rolling our price targets to 2012 earnings from 2011 (we moved to 2012 for most capital equipment and offshore drillers previously).

"Top Oil Service Picks Are Large Cap Diversified, Equipment Manufacturers, and Select Small/Mid Caps. The beginnings of a long international and offshore upcycle are particularly positive for the large cap diversified oil service companies as this plays into their strengths. The large caps are also trading at what we believe are attractive valuations. Our favorite large caps are Weatherford International, Halliburton and Schlumberger. We also believe the industry is in the early stages of an offshore rig new building cycle and we view National Oilwell (NYSE:NOV) as the best way to invest in this theme with Cameron (NYSE:CAM) another of our favorite capital equipment providers. In addition we like Tenaris (NYSE:TS) for its high operating leverage, exposure to deepwater and a shift towards premium tubulars. In the small and mid caps our strongest recommendations are Superior Energy Services (NYSE:SPN), Dresser-Rand (NYSE:DRC), Chart Industries (NYSE:GTLS), ION Geophysical (NYSE:IO) and Global Geophysical (NYSE:GGS). We think FMC Technologies (NYSE:FTI) is well positioned but are downgrading the stock to equal weight reflecting valuation."

BAS price target to $17, CAM to $57, GTLS to $43, DRC to $50, DRQ to $88, ESV to $53, GGS to $14, GLF to $34, HAL to $58, HOS to $28, IO to $10, NBR to $25, NOV to $78, PTEN to $24, SLB to $102, SPN to $43, TS to $64, WFT to $31.

Weatherford closed Wednesday at $20.55, down $0.15, or 0.72 percent. Halliburton ended at $39.79, down $1.29, or 3.14 percent. Schlumberger closed the day at $80.72, down $0.61, or 0.75 percent.