Wed, Feb. 18, 10:34 AM
- Exxon Mobil (XOM -1.7%) is well positioned to pick up assets in Australia amid the sharp drop in energy prices, including assets that could be bolted on to existing operations, says Richard Owen, the chairman of XOM's Australian business.
- Meanwhile, XOM continues to assess whether to develop deeper gas fields in the Bass Strait of the country's south coast, where future gas reservoirs are more expensive to develop since they are smaller, deeper and have higher levels of impurities.
Tue, Feb. 17, 5:11 PM
- Warren Buffett added to his IBM bet amid the IT giant's Q4 selloff: Berkshire Hathaway (BRK.A, BRK.B) owned 77M IBM shares at the end of Q4, up from 70.5M at the end of Q3. (13F filing)
- Berkshire also upped its stake in Suncor (NYSE:SU) by nearly 4M shares to 22.4M as oil prices plunged. However, the firm dumped the 41M-share stake in Exxon Mobil (NYSE:XOM) it held at the end of Q3, and its 5M-share stake in ConocoPhillips (NYSE:COP). Its 449K-share stake in Express Scripts (NASDAQ:ESRX) was also liquidated.
- A new 8.4M-share stake was taken in Restaurant Brands (QSR - rose 8.7% today following earnings), and a 4.7M-share stake in 21st Century Fox (NASDAQ:FOXA). Existing stakes in GM, DirecTV, MasterCard, and Visa were moderately upped (among others), and stakes in Bank of New York and National Oilwell moderately lowered.
- Berkshire owned 17.1M Deere (NYSE:DE) shares at the end of Q4, up from 7.6M at the end of Q3 (the Q3 stake was kept confidential). Deere is up 1.6% AH.
- Overall, Buffett's firm created or expanded positions in 15 companies, and cut or liquidated positions in 5.
Sat, Feb. 14, 8:25 AM
- Exxon (NYSE:XOM), Chevron (NYSE:CVX), Conoco (NYSE:COP) and Shell (RDS.A, RDS.B) have held steady even as the price of crude has fallen from $80/bbl to $50, which suggests little upside for the shares if oil turns up and big trouble if it doesn't, according to a weekend feature in Barron's.
- XOM and its peers are struggling to grow production, incurring heavy capital expenditures, dealing with increasingly difficult host governments, and facing a world in which energy demand is growing at about half the rate of global GDP; despite $38B in capital spending last year, XOM’s energy production fell ~2% and is projected to be unchanged this year.
- Energy stocks actually have outperformed the broader market so far this month as crude oil prices have bounced off lows, but many experts expect oil to resume its downward slide; Citigroup, for one, warns crude could dip as low as $20, which surely would spark another broad downturn for energy stocks as companies are forced to shut down wells.
- That’s the main reason analysts are calling for energy sector earnings to worsen in the coming quarters, which makes stocks that look cheap at first glance actually quite expensive and suggests they still haven’t hit bottom.
Thu, Feb. 12, 3:27 PM
- Exxon Mobil's (XOM +1.9%) push for workers at its Beaumont, Tex., refinery to sign a five-year contract, nearly twice as long as the last one, is part of an effort to avert labor stoppages during a possible expansion that could make it the largest such plant in the U.S., according to Reuters.
- XOM is said to have offered a $4,500 bonus to hourly workers represented by the United Steelworkers union, which normally only signs three-year deals in the refining industry.
- Acceptance of the proposal would leave the USW Beaumont local out of sync with the union’s current national bargaining program for refinery workers.
- As reported in July, before crude prices plunged, XOM is evaluating a five-year, multibillion-dollar expansion to lift the refinery’s processing capacity to 500K-800K bbl/day from 344K now.
Thu, Feb. 12, 2:14 PM
- If Exxon Mobil (XOM +1.6%) decides to go hunting for struggling energy peers with shrinking cash flow - as it did five years ago when it acquired XTO Resources for $25B, during an energy rout worse than today's - it would need to go big or not go at all in order to meaningfully boost its oil and gas reserves, WSJ writes as it discusses BP (BP +2.1%) as a potential takeover target.
- BP “is the obvious fit says Wolfe Research's Paul Sankey; buying BP, which is still dealing with the fallout of the 2010 Gulf of Mexico oil spill, “would close out a damaged brand at a terrific price” and bolster XOM’s capacity to find new sources of oil and gas, he says.
- Other potentially attractive targets singled out by analysts include a smaller tier of companies such as Anadarko (APC +1.9%) and BG Group (OTCPK:BRGXF, OTCQX:BRGYY), which have discovered huge deposits of oil and gas but may lack the cash flow to develop them quickly.
Thu, Feb. 12, 11:33 AM
- Pennsylvania Gov. Tom Wolf is proposing a new 5% severance tax on natural gas extraction in the state, saying the measure could generate $1B or more.
- The measure could face some pushback in the state's Republican-controlled legislature, but some kind of fracking tax could pass, as lawmakers from both parties already have proposed taxes from 3.2% to 8%.
- Like other major natural gas producing states, Pennsylvania already has a severance tax on the value of the gas extracted at the wellhead.
- Top Marcellus Shale producers include CHK, RRC, RDS.A, RDS.B, TLM, APC, ATLS, COG, CVX, CNX, EQT, EOG, XOM, WPX, XCO, CRZO, SWN, AR.
Wed, Feb. 11, 12:43 PM
- Royal Dutch Shell (RDS.A, RDS.B) and BP are resisting efforts by Abu Dhabi to get them to pay a multibillion-dollar signing-on fee for a stake in developing the emirate’s biggest onshore fields, FT reports, adding that Exxon Mobil (NYSE:XOM) already has walked away from talks.
- Abu Dhabi's state-owned oil company is said to have demanded ~$8B combined from a number of companies hoping for part of a 40% equity stake in oil reserves to be jointly developed over the next 40 years; industry insiders consider the upfront payments one of the bigger ever for an oil concession.
- Total (NYSE:TOT) last week became the first to sign a new concession with Abu Dhabi in which the company paid a ~$2B upfront fee to secure its stake, under which it will earn ~$2.85 for every barrel sold vs. $1/bbl under a previous concession.
Wed, Feb. 11, 11:57 AM
- Pavilion analysts think the consensus has gone from being overly optimistic about the earnings of major energy companies such as Exxon (NYSE:XOM), Chevron (NYSE:CVX) and ConocoPhillips (NYSE:COP) to being too pessimistic.
- The firm sees earnings expectations that are now lower than the realized earnings in 2008 when oil prices went as low as $33/bbl; six months ago, analysts expected the sector earnings to grow nearly 10% in a year., but they are now expecting the largest earnings decline on record.
- ETFs: XLE, ERX, VDE, OIH, XOP, ERY, FCG, DIG, GASL, DUG, IYE, XES, IEO, IEZ, PXE, FENY, PXJ, RYE, FXN, DDG
Wed, Feb. 11, 11:45 AM
- Colombia wants to stop a decline in oil production by making its royalties system more favorable to large drillers, the head of the country’s planning department says.
- A proposal in the government's new four-year development plan would give oil companies a major incentive to invest in increasing output at existing fields by treating the extra crude as though it were from a new discovery, making it eligible for lower levies.
- Colombia’s crude output fell last year for the first time since 2005, while plunging oil prices has prompted Ecopetrol (NYSE:EC) and Pacific Rubiales (OTCPK:PEGFF) to cut investment.
- Exxon (NYSE:XOM), Shell (RDS.A, RDS.B) and ConocoPhillips (NYSE:COP) reportedly have deferred shale exploration plans in the country.
Tue, Feb. 10, 5:59 PM
- Exxon Mobil (NYSE:XOM) reportedly is deferring shale exploration plans in Colombia, as collapsing crude oil prices are said to have exacerbated concerns over gaps in rules covering hydraulic fracturing in the country.
- Royal Dutch Shell (RDS.A, RDS.B) and ConocoPhillips (NYSE:COP) also have deferred shale exploration spending in the country, the Bloomberg report says.
- The moves would be a blow to Colombia’s hopes of developing shale deposits as a way of countering stagnating conventional oil reserves.
Mon, Feb. 9, 11:29 AM
- Exxon Mobil (XOM +0.5%) is downgraded to Hold from Buy at Argus, which believes XOM's recent outperformance relative to peers is likely to end given its difficulties in growing reserves and production.
- Argus is concerned that XOM could overreach in trying to grow reserves by pursuing an acquisition that could destroy shareholder value, as happened when the company overpaid for XTO Energy in 2009.
- The firm also thinks XOM's decision to reduce quarterly stock buybacks to $1B in Q1 from the usual level of $3B will weigh on investor sentiment.
Thu, Feb. 5, 5:50 PM
- Big oil companies had a poor record of finding and producing oil and gas last year, Reuters reports as it cites figures out in the past week, and big cuts in spending in response to falling crude prices could undermine their plans to turn that around.
- Royal Dutch Shell (RDS.A, RDS.B), Chevron (NYSE:CVX), ConocoPhillips (NYSE:COP) and BP released provisional figures showing together they replaced only two-thirds of the hydrocarbons they extracted in 2014 with new reserves; combined with Exxon Mobil (NYSE:XOM), they posted an average drop in oil and gas production of 3.25% in 2014.
- The 2014 results echo long-term trends: Over the past decade, the biggest Western oil majors have seen reserves growth stall, production drop 15% and profits fall by nearly 20%.
- Some analysts warn that overly aggressive cuts could have long-term repercussions; the expertise needed to develop new fields and infrastructure takes long periods to build up, thus if companies lose this expertise, they may struggle to expand their portfolios when oil prices recover.
Mon, Feb. 2, 6:24 PM
- Canadian Oil Sands (OTCQX:COSWF) jumped 20% today in Toronto on rumors it could be a takeover target by one of its partners in Syncrude Canada.
- Canadian Oil Sands is the largest shareholder in Syncrude, with a 37% stake, but larger companies such as Imperial Oil (NYSEMKT:IMO) also own major stakes in the venture; the rumors appeared to take flight as IMO parent company Exxon Mobil (NYSE:XOM) signaled today that it would be acquisitive in the current low oil price environment.
- FirstEnergy Capital analyst Michael Dunn says a Canadian Oil Sands “takeout by another Syncrude partner is a distinct possibility should the shares continue to languish."
Mon, Feb. 2, 12:59 PM
- Exxon Mobil (XOM +0.9%) is downgraded to Sector Perform from Sector Outperform with a $91 price target, cut from $99, at Howard Weil after today's Q4 earnings report.
- The firm believes that while U.S. oil firms have appeared to receive the lion’s share of capital inflows given their defense positioning amid an ongoing downturn in commodity prices, but capital should begin to flow to higher beta and underperforming stocks that represent more attractive value.
- Weil also cuts its price targets across the board for the integrated oil companies: BP by $5 to $41, ConocoPhillips (NYSE:COP) by $4 to $68, Chevron (NYSE:CVX) by $4 to $104, Shell (RDS.A, RDS.B) by $6 to $69, Statoil (NYSE:STO) by $4 to 427, and Total (NYSE:TOT) by $2 to $59.
Mon, Feb. 2, 12:28 PM
- Exxon Mobil (XOM +1.2%) remained mum on its 2015 capital spending guidance during its earnings conference call but says it remains committed to growing its dividend.
- After saying in its Q4 earnings report that it was cutting its share buyback program from $3B in Q4 2014 to $1B in Q1 2015, the company said it would make buyback decisions during the year based on cash flow; free cash flow was $18B for 2014, up from $10.7B in 2013.
- XOM's investment plan will change but not very much because the company bases its strategy on long-term planning, says the VP of investor relations.
- Management also said it had nothing new to report regarding the Russia situation, where sanctions are still in place.
- Edward Jones analyst Brian Youngberg finds the quality of the earnings beat "questionable," with some net-tax effects and the favorable arbitration ruling for expropriated Venezuelan assets really driving the earnings beat, and says XOM remains "growth challenged."
Mon, Feb. 2, 9:19 AM
- Exxon Mobil (NYSE:XOM) +0.6% premarket as unadjusted Q4 earnings fell 21% Y/Y due to lower commodity prices in the upstream division and higher downstream maintenance costs, partially offset by improved margins in the chemicals business, but results still easily beat Wall Street expectations.
- Q4 results were helped by ~$1B of non-cash effects that included U.S. deferred income tax items and the recognition of a favorable arbitration ruling for expropriated Venezuela assets.
- Q4 refining and marketing earnings fell by 54% Y/Y to $497M, while earnings in the chemical segment jumped 35% to $1.2B, boosted by stronger margins and low feedstock costs.
- E&P earnings fell 19% to $5.5B, hurt by lower production.
- Q4 oil and gas production dropped 3.8% on an oil-equivalent basis to a lower than expected 4.054M bbl/day; excluding the impact of the expiration of the Abu Dhabi onshore concession, production fell 0.7%, with liquids up 3.6% and natural gas down 5.5%.
- Q4 capex rose 5.4% to $10.46B; for the full year, capex fell 9.3% Y/Y to $38.54B.
- XOM also says it will reduce its share buyback program in Q1 to $1B after spending $3B on share repurchases during Q4.
- XOM did not provide guidance, but analysts expect Q1 EPS of $0.85 on revenues of $51.24B, vs. EPS of $2.10 and revenues of $106.77B in Q1 2014.
XOM vs. ETF Alternatives
Exxon Mobil Corporation is engaged in energy, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products.
Other News & PR