Chevron Corp (CVX), the second-largest U.S. oil company, is scheduled to report its fiscal third quarter 2009 financial results on Friday, October 30, 2009. In the last two quarters, the company's actual earnings fell short of the market's consensus significantly.
Chevron previously reported it earned $1.75 billion, or 87 cents per share, in the second quarter, down 71 percent from $5.98 billion, or $2.90 per share, a year earlier. The company didn't offer a specific third-quarter earnings estimate. Chevron's third-quarter profit last year more than doubled on record crude prices during the summer. It earned $7.89 billion, or $3.85 a share, in the three months ended Sept. 30 - its largest quarterly profit in its 129-year corporate history.
Analysts' estimates for the quarter ending September 2009 (Q3) range from a low of $1.33 to a high of $1.84, with a consensus of $1.473. For the fiscal quarter ending September 2009, the consensus EPS forecast has increased over the past week from $1.449 to $1.473 (1.66%) and increased over the past month from $1.410 to $1.473 (4.47%). Of the 14 analysts making quarterly forecasts, 9 raised and 3 lowered their forecast.
The upward revision in earnings estimates is attributable to higher crude oil prices and gains from asset sales and tax items. Chevron said that compared with the average for the second quarter, net U.S. oil-equivalent production during the first two months of the third quarter increased 41,000 barrels per day mainly due to increased production in the Gulf of Mexico. However, results from its downstream businesses such as refining and marketing are expected to be relatively flat.
On October 18, the company announced an additional natural gas discovery in the Greater Gorgon area`s Carnarvon Basin, Australia's offshore hydrocarbon zone. On October 27, Chevron Corp. said it is shutting down its Los Angeles-area refinery in El Segundo, California. It did not say how long the shutdown would last.
Going forward, for the fiscal year ending December 2009, the consensus EPS forecast has increased over the past week from $4.412 to $4.461 (1.11%) and increased over the past month from $4.299 to $4.461 (3.77%). Of the 12 analysts making yearly forecasts, 10 raised and 3 lowered their forecast. The upward revision is due to improving pricing and declining operating costs. The company's stock closed Wednesday at $75.89, compared to the 52 week range of $56.12 and $81.92. The stock seems to be trading at appropriate levels.
