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ExxonMobil (XOM) to Report Q3 Earnings: What's in Store?

Exxon Mobil Corporation XOM is set to report third-quarter 2019 results on Nov 1, before the opening bell.

Let’s see how things are shaping up prior to the announcement.

Which Way are Estimates Headed?

Let’s take a look at the estimate revision trend to get a clear picture of what analysts feel about the integrated energy major prior to the earnings release.

The Zacks Consensus Estimate for third-quarter earnings of 64 cents has seen no upward revision and four downward movements in the past 30 days. The figure suggests a year-over-year decline of 56.2%.

Further, the Zacks Consensus Estimate for revenues is pegged at $67.9 billion for the quarter, indicating a decline of 11.4% from the year-ago reported figure.

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Factors to Consider

Through the September quarter of 2019, price of West Texas Intermediate and Brent crude plunged 8.5% and 8.9%, respectively. Ramped-up production from U.S. shale resources, especially in the Permian, and weak global crude demand owing to intensified trade tensions between Washington and Beijing, impacted commodity prices.

The drop in oil prices is likely to have clipped ExxonMobil’s third-quarter 2019 profit from upstream operations. The latest SEC filing revealed that the company expects total quarterly earnings from upstream businesses, including the domestic market and abroad, to decline roughly 45% from the September quarter of 2018.

ExxonMobil also anticipates a 70% slump in third-quarter 2019 profit from downstream businesses from the year-ago period.

As a whole, the energy giant projects total profit decline of 50% to $3.1 billion from the prior-year quarter, owing to underperformance by upstream and downstream businesses.

Earnings Whispers

Our proven model does not indicate an earnings beat for ExxonMobil. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases chances of an earnings beat. That is not the case here as you will see below.

Earnings ESP: The company’s Earnings ESP is -0.47%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: ExxonMobil currently carries a Zacks Rank #5 (Strong Sell).

Highlights of Q2 Earnings & Earnings History

In the last reported quarter, the company delivered earnings of 73 cents per share that beat the Zacks Consensus Estimate of 68 cents. However, quarterly earnings fell year over year from 92 cents.

Notably, ExxonMobil has an average positive earnings surprise of 11.05% for the past four quarters, as shown in the chart below.

Exxon Mobil Corporation Price and EPS Surprise

 

Exxon Mobil Corporation Price and EPS Surprise
Exxon Mobil Corporation Price and EPS Surprise

Exxon Mobil Corporation price-eps-surprise | Exxon Mobil Corporation Quote

Stocks That Warrant a Look

Though an earnings beat looks uncertain for ExxonMobil, here are a few firms that you may want to consider on the basis of our model. These have the right combination of elements to post an earnings beat in the upcoming quarterly reports:

Plains All American Pipeline LP PAA has an Earnings ESP of +5.93% and is Zacks #3 Ranked. The company is scheduled to release earnings on Nov 5. You can see the complete list of today’s Zacks #1 Rank stocks here

Gulfport Energy Corporation GPOR has an Earnings ESP of +3.57% and a Zacks Rank #3. The company is set to release earnings on Oct 31.

Pioneer Natural Resources Company PXD has an Earnings ESP of +1.98% and is Zacks #3 Ranked. The company is scheduled to release earnings on Nov 4.

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Plains All American Pipeline, L.P. (PAA) : Free Stock Analysis Report
 
Exxon Mobil Corporation (XOM) : Free Stock Analysis Report
 
Gulfport Energy Corporation (GPOR) : Free Stock Analysis Report
 
Pioneer Natural Resources Company (PXD) : Free Stock Analysis Report
 
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