It has been about a month since the last earnings report for Exxon Mobil (XOM). Shares have lost about 9.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Exxon due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
ExxonMobil Q1 Earnings & Revenues Miss Estimates
ExxonMobil reported weak first-quarter 2019 results due to significant lower contributions from its downstream and chemical businesses.
This largest publicly-traded integrated energy company's earnings per share of 55 cents lagged the Zacks Consensus Estimate of 75 cents. Moreover, the bottom line declined significantly from the year-earlier figure of $1.09.
Total revenues of $63,625 million fell short of both the Zacks Consensus Estimate of $67,927 million and the year-ago sales of $68,211 million.
Upstream: Quarterly earnings came in at almost $3 billion, lower than $3.5 billion in the year-ago quarter. Affected natural gas prices on account of warmer weather along with less production of the commodity hurt the segment. A bleak crude pricing scenario as compared to the same in first-quarter 2018 also hampered the upstream business.
Total production averaged 3.981 million barrels of oil-equivalent per day (MMBOE/d), higher than 3.889 MMBOE/d a year ago.
Liquid production increased year over year to 2.327 million barrels per day (MMB/D) from 2.216 MMB/D, courtesy of the ramped-up activities in the prolific Permian Basin. However, natural gas production was 9.924 BCF/d (billions of cubic feet per day), down from 10.038 BCF/d in the year-ago period.
Downstream: The segment incurred a loss of $256 million against the year-ago quarterly profit of $940 million due to significant scheduled maintenance activities and the contraction in fuel margin.
ExxonMobil's refinery throughput averaged 3.9 million barrels per day (MMB/D), lower than the year-earlier level of 4.3 MMB/D.
Chemical: This unit contributed to the company's $518 million profit, down from the marginally above $1 billion in the prior-year quarter, induced by a soft margin.
During the quarter under review, ExxonMobil generated cash flow of $8.5 billion from operations and asset divestments, down from almost $10 billion in the year-ago quarter. This energy giant returned $3.5 billion to its shareholders through dividends. Following its significant investment in the prolific Permian Basin in the United States, the company's capital and exploration spending shot up 42% year over year to $6.9 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates flatlined during the past month. The consensus estimate has shifted -11.59% due to these changes.
Currently, Exxon has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Exxon has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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