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Barclays' Q2 Energy Earnings Expectations For Oil Majors & Refiners

Barclays' Q2 Energy Earnings Expectations For Oil Majors & Refiners - ConocoPhillips NYSE:COP, Chevron Corporation NYSE:CVX

It could be a mixed bag this earnings season for oil investors. Barclays analyst Paul Cheng expects oil majors will beat earnings expectations in Q2, but refiners could come up short once again.

Barclays projections are good news for oil majors investors, but Cheng notes consensus estimates are a low bar to clear.

“While oil & gas prices have recovered sharply from multi-year sub-$30/bl lows in 1Q16, we expect most companies to be unable to generate positive earnings, even at mid-$40/bl oil price deck-with the notable exception of XOM,” Cheng explained.

Related Link: Exxon And Chevron's New $37-Billion Project Is 'Inflection Point' For Oil Market

For refiners and MLPs, Barclays has lowered its 2016 EPS estimates by 61 percent and anticipates downward revisions to Q3 estimates. Despite the negative outlook, the firm names Tesoro Corporation TSO 0.86% as its top refiner stock pick, followed by Valero Energy Corporation VLO 1.09% and Marathon Petroleum Corp MPC 0.46%.

Barclays has upped its 2016 EPS estimates by 25 percent for the oil majors and named Suncor Energy Inc. (USA) SU 0.04% and ConocoPhillips COP 0.27% as its top stock picks.

Disclosure: the author holds no position in the stocks mentioned.

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DateFirmActionFromTo
Jul 2016JP MorganUpgradesUnderweightNeutral
Apr 2016CitigroupMaintainsBuy
Apr 2016JefferiesDowngradesHoldUnderperform

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