NEW YORK, NY / ACCESSWIRE / March 15, 2017 / The increased oil production by Saudi Arabia to 10 million barrels a month by reversing about a third of its production cut in February has come ashore to affect the outlooks for American oil companies like Chevron and Exxon Mobile. Oil has been surging of recent, approaching the $50 per barrel mark, having settled to $47.72 and is not expected to challenge the $50 barrier in the near term, however it gained back to the level above $48 after Saudi Arabia explained increased in production.
RDI Initiates Coverage:
Chevron Corporation https://ub.rdinvesting.com/news/?ticker=CVX
Exxon Mobil Corporation https://ub.rdinvesting.com/news/?ticker=XOM
Chevron was one of the companies put on investor watch lists for Tuesday. The company posted a share decline of $1.99 in stock value, closing at $107.36. After hours trading did begin to show signs of a small price recovery. Its drop was one lowlight that led the Dow Industrials decline of 44 points for the day. Despite the negative trend on oil prices, there are still a number of investment rating analysts recommending a "buy" of the stock, while a growing number downgraded their short term views to "hold". A look in the rear view mirror to January's earnings report has Chevron missing analysts' expectations, as the company posted a 22 cent earnings per share for the 4th quarter on January 27th, missing predictions by 42 cents a share, according to Thomson Reuters.
Access RDI's Chevron Corporation Research Report at: https://ub.rdinvesting.com/news/?ticker=CVX
Tuesday's drop of Exxon Mobil stock of 44 cents a share is the result of a mixed bag of news making its way through the industry. Interestingly, it has little to do with the Saudi increase in production and more to do with the company's financials. Its closing price of $80.99 saw an uptick in the early hours of after-hours trading. There are rumors that Exxon Mobile is interested in making a takeover bid for British Petroleum, but the contrarian view is that such a takeover would cause more problems than solutions because it is not a good strategic fit. Then there is the news of the company increasing its capital expenditures, at a time when the vast majority of major oil companies are standing pat with their own or even trimming back to improve their cash flow. The fact that Exxon Mobil can do this given the current environment says more about the company's internal potential regardless of the external factors.
Access RDI's Exxon Mobil Research Report at: https://ub.rdinvesting.com/news/?ticker=XOM