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Will Exxon Mobil's (XOM) Upstream Unit Drive Q1 Earnings?
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We expect Exxon Mobil Corporation's (XOM - Free Report) first-quarter 2018 results to show an improvement in earnings from upstream operations outside the United States. Through 2017, the largest publicly traded energy firm generated 34.2% of total profit from non-U.S. upstream businesses.
The core operations of Exxon Mobil include upstream businesses. This segment reflects the company’s activities related to exploring and developing prospective oil and natural gas resources.
From the upstream operations — both in and outside the United Sates — the company reported earnings of $13.4 billion through 2017. The profits represent almost 68% of total earnings garnered during the period.
Q4 Upstream Performance
Non-U.S. Operations: During fourth-quarter 2017, Exxon Mobil reported earnings of $1.3 billion from upstream activities outside the United States. This reflected a decline of 23.4% from the year-earlier profit of $1.7 billion.
Moreover, non-U.S. profit from the segment lagged the Zacks Consensus Estimate of $2.4 billion.
U.S Operations: From the domestic operations, Exxon Mobil reported earnings of $7.1 billion against a loss of $2.3 billion in the year-ago quarter.
Factors Impacting Q4 Results: Higher liquid price realizations and ramp up of projects supported upstream operations in the fourth quarter. The positives were negated by a decline in field.
Q1 Oil Price Impressive
Per The U.S. Energy Information Administration (EIA), the average monthly West Texas Intermediate (WTI) crudeprice for January, February and March of 2018 was recorded at $63.70 per barrel, $62.23 per barrel and $62.73 per barrel, respectively. Importantly, from 2015 to 2017, the monthly average oil price never crossed the $60 psychological mark. The extension of the production cut deal by the OPEC players through 2018-end primarily led to the partial crude recovery.
However, the natural gas price scenario wasn’t quite favorable. During the quarter, the commodity slipped almost 55%.
Projections for Q1 Crude & Gas Output
Natural Gas Production: The Zacks Consensus Estimate for natural gas production available for sale is at 10,782 million cubic feet per day (MMcf/D), higher than 10,441 MMcf/D for the fourth quarter of 2017 but down from 10,908 MMcf/D for first-quarter 2017.
Production of Crude & Natural Gas Liquids: The Zacks Consensus Estimate for daily net production of crude and natural gas liquids stands at 2,342 thousand barrels per day (B/D), higher than 2,251 thousand B/D in the prior quarter and 2,333 thousand B/D in the year-ago quarter.
Upstream Likely to be Healthy in Q1
Non-U.S. Operations: The Zacks Consensus Estimate for earnings after tax from non-U.S. upstream operations stands at $3.2 billion, higher than $1.3 billion reported in the prior quarter and $2.3 billion in the year-ago quarter.
U.S. Operations: Also, for upstream operations in the domestic region, the Zacks Consensus Estimate for after-tax earnings is pegged at $205 million against a loss of $18 million in the year-ago quarter. During fourth-quarter 2017, the company reported profit of $7.1 billion.
The fate of upstream business primarily depends on the prices and production of oil and natural gas. Liquid accounted for more than 57% of the company’s total production through 2017. Hence, we can say that the price and output of oil are the two key parameters that could drive results of the upstream business for Exxon Mobil.
Healthy oil pricing scenario and higher expected liquid production will likely contribute to Exxon Mobil’s — a Zacks Rank #3 (Hold) stock — earnings in both the domestic and international markets. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Projections for Earnings & Revenues
The Zacks Consensus Estimate for first-quarter earnings of $1.18 per share reflects growth of 24.2% year over year. Also, the Zacks Consensus Estimate for sales of $66.1 billion indicates a 4.4% rise.
Earnings Schedule for Other Major Energy Players
Chevron (CVX - Free Report) will likely report first-quarter 2018 results on Apr 27. Meanwhile, major energy players BP plc (BP - Free Report) and EOG Resources, Inc. (EOG - Free Report) are slated to report results on May 1 and May 3, respectively.
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It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
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Will Exxon Mobil's (XOM) Upstream Unit Drive Q1 Earnings?
We expect Exxon Mobil Corporation's (XOM - Free Report) first-quarter 2018 results to show an improvement in earnings from upstream operations outside the United States. Through 2017, the largest publicly traded energy firm generated 34.2% of total profit from non-U.S. upstream businesses.
We expect the company to record profits from upstream operations in the United States against a loss in the year-ago quarter. (See more in Exxon Mobil Gears Up for Q1 Earnings: What's in Store?)
Upstream Business
The core operations of Exxon Mobil include upstream businesses. This segment reflects the company’s activities related to exploring and developing prospective oil and natural gas resources.
From the upstream operations — both in and outside the United Sates — the company reported earnings of $13.4 billion through 2017. The profits represent almost 68% of total earnings garnered during the period.
Q4 Upstream Performance
Non-U.S. Operations: During fourth-quarter 2017, Exxon Mobil reported earnings of $1.3 billion from upstream activities outside the United States. This reflected a decline of 23.4% from the year-earlier profit of $1.7 billion.
Moreover, non-U.S. profit from the segment lagged the Zacks Consensus Estimate of $2.4 billion.
U.S Operations: From the domestic operations, Exxon Mobil reported earnings of $7.1 billion against a loss of $2.3 billion in the year-ago quarter.
Factors Impacting Q4 Results: Higher liquid price realizations and ramp up of projects supported upstream operations in the fourth quarter. The positives were negated by a decline in field.
Q1 Oil Price Impressive
Per The U.S. Energy Information Administration (EIA), the average monthly West Texas Intermediate (WTI) crudeprice for January, February and March of 2018 was recorded at $63.70 per barrel, $62.23 per barrel and $62.73 per barrel, respectively. Importantly, from 2015 to 2017, the monthly average oil price never crossed the $60 psychological mark. The extension of the production cut deal by the OPEC players through 2018-end primarily led to the partial crude recovery.
However, the natural gas price scenario wasn’t quite favorable. During the quarter, the commodity slipped almost 55%.
Projections for Q1 Crude & Gas Output
Natural Gas Production: The Zacks Consensus Estimate for natural gas production available for sale is at 10,782 million cubic feet per day (MMcf/D), higher than 10,441 MMcf/D for the fourth quarter of 2017 but down from 10,908 MMcf/D for first-quarter 2017.
Production of Crude & Natural Gas Liquids: The Zacks Consensus Estimate for daily net production of crude and natural gas liquids stands at 2,342 thousand barrels per day (B/D), higher than 2,251 thousand B/D in the prior quarter and 2,333 thousand B/D in the year-ago quarter.
Upstream Likely to be Healthy in Q1
Non-U.S. Operations: The Zacks Consensus Estimate for earnings after tax from non-U.S. upstream operations stands at $3.2 billion, higher than $1.3 billion reported in the prior quarter and $2.3 billion in the year-ago quarter.
U.S. Operations: Also, for upstream operations in the domestic region, the Zacks Consensus Estimate for after-tax earnings is pegged at $205 million against a loss of $18 million in the year-ago quarter. During fourth-quarter 2017, the company reported profit of $7.1 billion.
The fate of upstream business primarily depends on the prices and production of oil and natural gas. Liquid accounted for more than 57% of the company’s total production through 2017. Hence, we can say that the price and output of oil are the two key parameters that could drive results of the upstream business for Exxon Mobil.
Healthy oil pricing scenario and higher expected liquid production will likely contribute to Exxon Mobil’s — a Zacks Rank #3 (Hold) stock — earnings in both the domestic and international markets. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Projections for Earnings & Revenues
The Zacks Consensus Estimate for first-quarter earnings of $1.18 per share reflects growth of 24.2% year over year. Also, the Zacks Consensus Estimate for sales of $66.1 billion indicates a 4.4% rise.
Earnings Schedule for Other Major Energy Players
Chevron (CVX - Free Report) will likely report first-quarter 2018 results on Apr 27. Meanwhile, major energy players BP plc (BP - Free Report) and EOG Resources, Inc. (EOG - Free Report) are slated to report results on May 1 and May 3, respectively.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>