Why Did Hess See the Highest EPS Decline?

HES, APA, DVN, and MRO: How Do Top Upstream Players Stack Up?

(Continued from Prior Part)

EPS growth comparison: HES, APA, DVN, and MRO

This part will look at how Hess (HES), Apache (APA), Devon Energy (DVN), and Marathon Oil (MRO) fared in terms of EPS (or earnings per share) growth since last year.

Positive EPS growth for Devon

Devon was the only company to report positive earnings per share. The major reason for Devon’s positive earnings in 2015, despite the weak energy price environment, was its oil and gas hedges. However, DVN’s earnings could come under pressure this year as its hedges roll off.

In 4Q15, APA’s earnings were slightly negative. Again, weak oil and gas prices pushed earnings of many upstream companies lower as a result of lower realized prices. Barring 2Q15, APA’s EPS was negative for each quarter in 2015.

EPS for MRO and Hess fell the most

Unlike its other peers, MRO’s earnings were negative in 4Q14 as well. Year-over-year, earnings have declined by 148%. On the other hand, Hess reported the deepest losses in terms of earnings. According to Hess’s 4Q15 earnings release, lower realized energy prices reduced adjusted net income by ~$420 million compared to last year. Results for 4Q15 were also inclusive of non-cash goodwill and other impairment-related charges, which amounted to ~$1.4 billion after tax.

All these companies make up 7.1% of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP).

Continue to Next Part

Browse this series on Market Realist:

• Part 1 - How Have HES, APA, DVN, and MRO’s Stocks Performed?

• Part 2 - Why Did Apache See the Worst Decline in 4Q15 Revenue?

• Part 4 - Which Upstream Company Saw Production Volumes Rise the Most?