Brazilian state-run energy giant, Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) saw its shares decline 2.4% on Sep 29, 2016, after the country’s largest oil workers' federation rejected its contract offer and began preparing for a strike.
Petrobras offered a 4.97% increment in wage to the Federal Union Party. However, the company planned to cut overtime payments and regular work shifts. The union found this offer to be unacceptable.
Per Petrobras, the union's decision has not affected normal operations. The workers, however, are reported to have blocked a helicopter used by the company to access its offshore oil fields in the Campos basin.
Last November, Petrobras’ unionized workers went on strike for three weeks over pay and to protest against asset sales. This action cost the company about 30,000 barrels per day of production.
Petrobras, with net debt of around $103.56 billion, is the most indebted energy company in the world. The company is undergoing a deep financial crisis due to low oil prices and the loss of goodwill owing to the discovery of massive corruption within its ranks.
PETROBRAS-ADR C Price
Petrobras engages in the exploration, development, and production of crude oil, natural gas, and natural gas liquids. Additionally, the company sells crude oil and oil products produced at natural gas processing plants in domestic and foreign markets. It is also involved in the refining, logistics, transport, and trading of crude oil and oil products. Moreover, the firm exports ethanol and invests in petrochemical companies.
Petrobras currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the broader energy sector include Evolution Petroleum Corp. (EPM - Free Report) , Chevron Corporation (CVX - Free Report) and China Petroleum & Chemical Corp. (SNP - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the last four quarters, Evolution Petroleum posted an average positive earnings surprise of 45.8%.
China Petroleum & Chemical, on the other hand, posted an average positive earnings surprise of 1,383.3% in the last four quarters.
In the current quarter, Chevron posted a positive earnings surprise of 54.8%.
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