Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

We expect global oil and gas exploration and production company Murphy Oil Corporation (MUR - Analyst Report) to beat expectations when it reports fourth-quarter 2012 results on Jan 30, 2013.
 
Why a Likely Positive Surprise?

Our proven model shows that Murphy Oil is likely to beat earnings because it has the right combination of two key factors.

Positive Zacks ESP: Earnings Surprise Prediction or ESP (Read:Zacks Earnings ESP: A Better Method), which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is at 3.05%. This is very meaningful and a leading indicator of a likely positive earnings surprise for shares.

Zacks #3 Rank (Hold): We note that stocks with Zacks Ranks of #1, #2 and #3 have a significantly higher chance of beating earnings. The Sell-rated stocks (#4 and #5) should never be considered going into an earnings announcement.

The combination of Murphy Oil’s Zacks Rank #3 (Hold) and 3.05% ESP makes us very confident in looking for a positive earnings beat on Jan 30, 2013.

What is Driving the Better Than Expected Earnings?

Murphy Oil’s diversified asset base along with steady capital investment program and cost-curtailment measures are expected to lead to a positive earnings surprise in the current quarter. Sales of UK assets are benefiting Murphy Oil’s overall performance, which in turn prompted the company to follow the same path in the U.S. The company intends to spin-off its U.S. downstream subsidiary, Murphy Oil USA, Inc.

The positive trend is seen in the trailing four quarter average surprise of 0.68%. The company’s third-quarter 2012 surprise was -2.50% due to weaker U.S. retail marketing margins, lower North American natural gas sales prices, and an after tax loss from foreign exchange transactions.
 
Other Stocks to Consider

Murphy Oil is not the only company looking up this earnings season. We also see likely earnings beat coming from other operators in the industry.

TransAtlantic Petroleum Ltd. (TAT - Snapshot Report), Earnings ESP of +100.00% and Zacks Rank #2 (Buy)

ConocoPhillips (COP - Analyst Report), Earnings ESP of +0.71% and Zacks Rank #3 (Hold)

Occidental Petroleum Corporation (OXY - Analyst Report), Earnings ESP of +0.60% and Zacks Rank #3 (Hold)

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GROUP DXYN 15.84 +7.90%
BOFL HOLDING BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%