Murphy Oil Corp Earnings Cheat Sheet: Earnings Higher Than Expected

S&P 500 (NYSE:SPY) component Murphy Oil Corporation (NYSE:MUR) reported net income above Wall Street’s expectations for the third quarter. Murphy Oil is an oil and gas exploration and production company with refining and marketing operations in the U.S. and the United Kingdom.

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Murphy Oil Earnings Cheat Sheet for the Third Quarter

Results: Net income for Murphy Oil Corporation rose to $406.1 million ($2.09 per share) vs. $202.8 million ($1.05 per share) in the same quarter a year earlier. This is a more than twofold rise from the year earlier quarter.

Revenue: Rose to $7.24 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: MUR beat the mean analyst estimate of $1.13 per share. It fell short of the average revenue estimate of $7.53 billion.

Quoting Management: David M. Wood, President and Chief Executive Officer, commented, “We’re pleased to have recently completed our entry into the Baranan exploration license, at a 25% working interest, in the Kurdistan Region of Iraq. Drilling plans are moving forward with operations expected to commence in early 2012. Following the first well in Brunei Block CA-2, which found hydrocarbons in noncommercial quantities, we are presently drilling the second well on that block, and have just commenced drilling on the first CA-1 well, with many promising prospects left to drill across this acreage. Activities on the Company’s North American resource acreage will be further expanded in coming months with the addition of two rigs in the EagleFord Shale oil window. The workover program at Kikeh is proving successful with production from the field exceeding our anticipated volume in the just completed third quarter. Additionally, our U.S. retail marketing business contributed another quarter of strong profits. Murphy’s partnership with Walmart to provide customers a deep discount gasoline offer continues through Christmas Eve and is being well received. We are pleased to have completed the sale of the two U.S. refineries at the end of the third quarter as this was an important step in our repositioning efforts. We will now refocus on selling our U.K. downstream assets in 2012.

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 14.4% and in the first quarter, the figure rose 80.6%.

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of $1.60 versus a mean estimate of net income of $1.66 per share.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the fourth quarter is $1.34 per share, down from $1.70 ninety days ago. At $5.49 per share, the average estimate for the fiscal year has fallen from $6.19 ninety days ago.

Competitors to Watch: Marathon Oil Corporation (NYSE:MRO), Western Refining, Inc. (NYSE:WNR), Sunoco, Inc. (NYSE:SUN), Chevron Corporation (NYSE:CVX), Exxon Mobil Corporation (NYSE:XOM), BP plc (NYSE:BP), ConocoPhillips (NYSE:COP), Valero Energy Corporation (NYSE:VLO), Tesoro Corporation (NYSE:TSO), and Hess Corp. (NYSE:HES).

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(Source: Xignite Financials)