2 Energy Stocks Trading Choppier as Earnings Reports Digested

Diamond Offshore Drilling Inc. (NYSE:DO) reported its results for the fourth quarter. Net income for Diamond Offshore Drilling Inc. fell to $188.5 million ($1.36 per share) vs. $241.7 million ($1.74 per share) a year earlier. This is a decline of 22% from the year earlier quarter. Revenue fell 11% to $748.4 million from the year earlier quarter. Diamond Offshore Drilling Inc. beat the mean analyst estimate of 99 cents per share. Analysts were expecting revenue of $738.7 million.

“The $1.2 billion of revenue backlog we were able to add since the end of the last quarter demonstrates the strong demand in all of our key markets,” said Larry Dickerson, President and Chief Executive Officer of Diamond Offshore. “Our newbuild drillships, the Ocean BlackHawk and Ocean BlackHornet, have long-term contracts beginning in Q4 2013 and Q2 2014. Additionally, given the strong current environment, we think significant opportunity exists for our third newbuild drillship, the Ocean BlackRhino, as well as for deepwater units such as our recently announced Ocean Onyx.”

Competitors to Watch: Pride International, Inc. (NYSE:PDE), Transocean LTD (NYSE:RIG), Helmerich & Payne, Inc. (NYSE:HP), Patterson-UTI Energy, Inc. (NASDAQ:PTEN), Noble Corporation (NYSE:NE), Atwood Oceanics, Inc. (NYSE:ATW), Vantage Drilling Company (AMEX:VTG), Seahawk Drilling, Inc. (NASDAQ:HAWK), Rowan Companies, Inc. (NYSE:RDC), and Hercules Offshore, Inc. (NASDAQ:HERO).

Tesoro Corporation (NYSE:TSO) reported its results for the fourth quarter. Reported a loss of $124 million (89 cents per diluted share) in the quarter. Tesoro Corporation had a net income of $3 million or 2 cents per share in the year earlier quarter. Revenue rose 39.9% to $7.71 billion from the year earlier quarter. Tesoro Corporation fell short of the mean analyst estimate of a loss of 66 cents per share. It beat the average revenue estimate of $5.48 billion.

“The fourth quarter was a challenging period as a result of the dramatic change in crude oil price differentials,” said Greg Goff, President and CEO of Tesoro. “Despite the loss in the fourth quarter, our full year results were better than any year since 2007 when we posted similar earnings on a Tesoro Index that was 40% higher. The Company`s strong performance for the year clearly demonstrates our ability to deliver fundamental improvements in the business.” With a strategic focus on operational efficiency and effectiveness, the Company increased refinery utilization rates, capturing additional gross margin while reducing manufacturing costs per barrel during 2011. The resulting strong free cash flow allowed the company to reduce debt by $328 million, further strengthening its balance sheet. The Company also increased the integration between refining and marketing and successfully launched Tesoro Logistics.”

Competitors to Watch: Valero Energy Corporation (NYSE:VLO), Alon USA Energy, Inc. (NYSE:ALJ), Western Refining, Inc. (NYSE:WNR), Sunoco, Inc. (NYSE:SUN), Frontier Oil Corporation (NYSE:FTO), Holly Corporation (NYSE:HOC), Delek US Holdings, Inc. (NYSE:DK), Calumet Specialty Products Partners, L.P (NASDAQ:CLMT), CVR Energy, Inc. (NYSE:CVI), and Chevron Corporation (NYSE:CVX).

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com