Earnings Cheat Sheet: Chevron Corporation Slows But Leads Energy

Chevron Corporation (CVX) is one of the six largest non state-owned energy companies in the world. The multinational energy corporation is involved in exploration, production, and refining of oil and gas. Chevron missed on third quarter profit but earnings are up substantially for the first nine months already. Its biggest competitor, Exxon Mobil (XOM), beat their third quarter estimates yesterday.

Earnings: Earnings declined to $3.77 billion ($1.87 a share) from $3.83 billion ($1.92 a share) last year. Foreign currency effects decreased earnings in the third quarter by $367 million, compared with a decrease of $170 million a year earlier.

Revenue: Revenue increased to $49.72 billion from $46.63 billion last year.

Actual versus Wall Street Expectations: Chevron’s earnings per share of $1.87 came short of estimates of $2.15 per share.

Notable Stats: Production rose 1% to 2.74 million barrels a day.

Chevron plans to buy back $500 million to $1 billion in stock per quarter, starting in the fourth quarter.

For the first nine months of 2010, earnings were $13.73 billion ($6.84 per share), up from $7.41 billion ($3.71 per share) in the first nine months of 2009.

Did You Hear That? “Earnings for the quarter were essentially flat with a year ago, but up sharply for nine months. Operationally, we continue to show gains in upstream production and progress on our downstream restructuring,” said Chairman and CEO John Watson.

Commentary: Much like its largest competitor Exxon Mobil (XOM), Chevron (CVX) has been steadily rallying since the beginning of July; it has been trading above its rising 50 DMA and 200 DMA. The Energy SPDR (XLE) has been lagging CVX, largely from the downward pressure exerted by XOM, but a 13.6% weight gives CVX a nice positive pull on XLE. XLE is also currently trading above its 50 DMA and 200 DMA. CVX is near 52-week highs, indicating strength, while XOM and XLE are trailing behind.

Disclosure: No positions in CVX, XOM, or XLE