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Tickers in this Article: OXY
Occidental Petroleum (NYSE:OXY) announced its results for the most recent quarter on October 25, 2012. Occidental Petroleum is an international organization with subsidiaries operating in the oil and gas, chemical, and midstream markets.

In most situations, when earnings do not meet analyst estimates, a business' stock price will tend to drop. On the other hand, when actual earnings beat estimates by a significant amount, the share price will likely surge. SEE: Earnings: Quality Means Everything

The Numbers: Occidental beat expectations with its latest EPS and revenue figures. The company reported $1.69 per share versus the $1.63 per share estimate and revenues of $5.96 billion versus the $5.85 billion estimate. Revenue fell 0.7% from the same period last year while EPS is down 22.1%. Revenue declined last quarter after shrinking 6.6% to $5.77 billion in the second quarter. Occidental reported net income of $1.38 billion during the third quarter. This is a 22.4% decline from last year. This marks the second quarter in a row that the company's net income has fallen after profits tumbled 26.9% in the second quarter.

Management Quote: In announcing the results, Stephen I. Chazen, President and Chief Executive Officer, said, "Our third quarter 2012 total company production of 766,000 barrels of oil equivalent per day was 27,000 per day, or four percent higher than the third quarter of 2011 production. Our domestic production of 469,000 barrels of oil equivalent was eight percent higher than the third quarter of 2011 and was a record for the eighth consecutive quarter. Our domestic liquids production of 334,000 barrels per day, which was also a record, was 10 percent higher than last year's third quarter."

A Look Back: Net income has increased 7% year-over-year on average across the last five quarters. The biggest gain came in the third quarter of the last fiscal year, when income climbed 48.7% from the year-earlier quarter.

Looking Ahead: Analysts appear increasingly optimistic about the company's results for the next quarter. The average estimate for the fourth quarter has moved up from $1.69 a share to $1.77 over the last 90 days. Increasing earnings estimate is a positive sign about the company and it typically leads a increase in the stock price. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. At $6.99 per share, the average estimate for the fiscal year has risen from $6.90 60 days ago.

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