Exxon Mobil Corp. (NYSE:XOM) is set to report FQ1 2014 earnings before the market opens on Thursday, May 1st. Exxon Mobil is a multinational oil corporation based in Texas which boasts the third highest annual revenue of all companies globally. XOM shares started the year on a sour note before mid February when energy and utility stocks became market leaders while tech and high flier growth stocks sold off. Since early February lows Exxon Mobil stock has rallied 13.5%. XOM profits are expected to fall this quarter compared to FQ1 of last year on higher operating costs and lower production volume. Here's what investors hope to see from Exxon Mobil on Thursday.
The information below is derived from data submitted to the Estimize.com platform by a set of Buy Side and Independent analyst contributors.
The current Wall Street consensus expectation is for Exxon Mobil to report $1.87 EPS and $111.404B revenue, while the current Estimize.com consensus from 22 Buy Side and Independent contributing analysts is $1.93 EPS and $110.502B in revenue. This quarter the buy-side as represented by the Estimize.com community is expecting Exxon Mobil to beat the Wall Street consensus on EPS but fail to live up to the Street's revenue prediction.
Over the past 6 quarters the consensus from Estimize.com has been more accurate than Wall Street in forecasting Exxon Mobil's EPS and revenue 3 times and twice respectively. By tapping into a wider range of contributors including hedge-fund analysts, asset managers, independent research shops, students, and non professional investors Estimize has created a data set that is more accurate than Wall Street up to 69.5% of the time, but more importantly it does a better job of representing the market's actual expectations. It has been confirmed by Deutsche Bank Quant. Research and an independent academic study from Rice University that stock prices tend to react with a more strongly associated degree to the expectation benchmark from Estimize than from the Wall Street consensus.
The magnitude of the difference between the Wall Street and Estimize consensus numbers often identifies opportunities to take advantage of expectations that may not have been priced into the market. In this case we are seeing a minor differential between the two groups' expectations on Exxon Mobil's earnings.
The distribution of estimates published by analysts on the Estimize.com platform range from $1.86 to $2.07 EPS and from $105.517B to $117.524B in revenues. This quarter we're seeing a wider range of estimates on Exxon Mobil's earnings.
The size of the distribution of estimates relative to previous quarters often signals whether or not the market is confident that it has priced in the expected earnings already. A wider distribution of EPS estimates signals less agreement in the market, which could mean greater volatility post earnings.
Throughout the quarter Wall Street lowered its EPS consensus for Exxon Mobil from $1.97 to $1.87, while the Estimize consensus fell from $2.02 to $1.93. Meanwhile, the Wall Street revenue consensus increased from a low of $105.617B to $111.404B, while the Estimize community brought its consensus down from $112.504B to 110.502B. Timeliness is correlated with accuracy and at the end of the quarter we saw flat revenue expectations and falling EPS projections.
The analyst with the highest estimate confidence rating this quarter is turbinecity, who projects $1.89 EPS and $111.705B in revenue. turbinecity was our Winter 2014 season winner and is ranked 3rd overall among over 4,350 contributing analysts. Over the past 2 years turbinecity has been more accurate than Wall Street in forecasting EPS and revenue 60% and 54% of the time respectively throughout over 2000 estimates. Estimate confidence ratings are calculated through algorithms developed by deep quantitative research which looks at correlations between analyst track records and tendencies as they relate to future accuracy. In this case, turbinecity is expecting Exxon Mobil to beat estimates on revenue but report between Wall Street and the Estimize community on EPS.
Despite expectations that revenue and profit will fall compared to last year, Exxon Mobil stock has been hot lately. This quarter contributing analysts on the Estimize.com platform are expecting Exxon Mobil to come up short on Wall Street's revenue expectations but beat EPS expectations by a comfortable margin.