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Exxon Shares Could Be Hurt Near-Term By Q2 Performance; Barclays Cuts Price Target To $100

Exxon Shares Could Be Hurt Near-Term By Q2 Performance; Barclays Cuts Price Target To $100 - Exxon Mobil Corporation NYSE:XOM

Shares of Exxon Mobil Corporation XOM 2.76% could come under slight pressure after the company reported an EPS miss, Barclays’ Paul Y. Cheng said in a report. He maintained an Equal Weight rating on the company, while reducing the price target from $102 to $100.

Exxon Mobil reported its EPS at $0.41, significantly below Barclays’ estimate of $0.67 and the consensus expectation of $0.64. The miss was mainly on account of the disappointing performance from the company’s international upstream operations.

Exxon Mobil’s results were substantially impacted by the significant sequential decline in international gas prices. “Operationally, performance was good; production averaged 3,957 mboe/d (000s boe/d) compared to our estimate of 3,923 mboe/d, despite disruptions in Nigeria and Canada,” analyst Paul Cheng mentioned.

The EPS estimates for FY1 and FY2 have been reduced from $2.55 to $2.05 and from $5.45 to $5.05, respectively.

Miss Due To One-Time Impacts

While there are concerns around the stability of near-term profits due to the sequential fluctuation in results, none of the major variances in 2Q reflect “ongoing and structural operational issues,” the analyst commented. He added that a recurrence of a level similar to the 2Q earnings was unlikely going forward.

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DateFirmActionFromTo
Aug 2016UBSMaintainsNeutral
Jun 2016Bank of AmericaDowngradesBuyNeutral
May 2016Argus ResearchUpgradesHoldBuy

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