Which Big Oil Stocks Have the Strongest Earnings Trends: Exxon, Chevron, BP, ConocoPhillips, or Total?

Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

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Here’s your Cheat Sheet to how the top 5 Big Oil stocks rank via earnings trends:

Exxon Mobil Corp. (NYSE:XOM): Current Price $90.04

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 477,360 310,590 383,220 486,430 482,300
Diluted EPS ($) 8.66 3.98 6.22 8.42 9.70

Annual revenue at Exxon has grown sharply after 2009, and EPS is slowing but strong.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012 Dec. 31, 2012
Revenue ($) in millions 121,610 124,050 127,360 115,710 115,170
Diluted EPS ($) 1.97 2.00 3.41 2.09 2.20

Unfortunately, we see that quarterly revenue and EPS performance is rather jumpy. The September 2012 quarter saw a sharp decline in both revenue and EPS. Exxon is growing earnings quarter-over-quarter, so they are definitely worthy of deeper consideration…

Chevron Corp. (NYSE:CVX): Current Price $116.50

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 273,000 171,640 204,930 253,710 241,910
Diluted EPS ($) 11.67 5.24 9.48 13.44 13.32

After a forgettable year in 2009, when both revenue and EPS plunged, Chevron has swung back with solid growth in sales and EPS. Unfortunately, 2012 saw a decline in revenues and EPS.

Quarter Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012 Dec. 31, 2012
Revenue ($) in millions 59,980 60,700 62,610 58,040 60,550
Diluted EPS ($) 2.58 3.27 3.66 2.69 3.70

Quarterly EPS is a bit inconsistent. However, earnings are growing quarter-over-quarter, so they are at least a watch list stock for now…

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BP plc (NYSE:BP): Current Price $44.77

Fiscal Year 2007 2008 2009 2010 2011
Revenue ($) in millions 291,440 367,050 246,140 308,930 386,460
Diluted EPS ($) 6.470 5.252 -1.175 8.058

After the disastrous year in 2009, BP has certainly fixed its revenue growth, but EPS has been highly volatile. Encouragingly, 2011 EPS swung nicely to a positive figure.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Sep. 30, 2011 Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012
Revenue ($) in millions 97,730 96,340 96,700 94,890 93,120
Diluted EPS ($) 1.577 2.400 1.844 -0.44 1.703

BP’s quarterly numbers disappoint on the revenue front, falling off during the last two quarters. However, EPS in the latest quarter has recovered well from the negative EPS reported in the June 2012 quarter. We’ll keep this one in the reckoning…

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ConocoPhillips (NYSE:COP): Current Price $58.82

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 246,930 152,390 198,660 251,230 62,000
Diluted EPS ($) -10.73 2.94 7.62 8.97 6.72

The annual revenue number at ConocoPhillips is rather erratic, though EPS grew nicely between 2009 and 2011. Unfortunately, both revenue and EPS went into a tailspin in 2012 after the company hived off its downstream business.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012 Dec. 31, 2012
Revenue ($) in millions 158,620 58,350 15,170 15,090 16,370
Diluted EPS ($) 2.56 2.27 1.80 1.46 1.16

ConocoPhillips, or what’s left of it, has shown marginally improving revenue in the latest three quarters. Unfortunately, EPS, on the other hand, is tapering off. Not the kind of company we’re looking for…

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Total SA (NYSE:TOT): Current Price $54.92

Fiscal Year 2007 2008 2009 2010 2011
Revenue ($) in millions 217,650 264,740 156,410 186,540 231,970
Diluted EPS ($) 7.95 6.93 5.27 6.43 7.23

Total SA has gotten its act together nicely after 2009, growing both revenue and EPS during 2010 and 2011.

Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Sep. 30, 2011 Dec. 31, 2011 Mar. 31, 2012 Jun. 30, 2012 Sep. 30, 2012
Revenue ($) in millions 64,800 63,110 67,620 62,960 62,380
Diluted EPS ($) 2.06 1.34 2.14 0.90 1.69

On the quarterly numbers, revenue has remained flat, though EPS in September 2012 almost doubled over June 2012. That’s nice growth, and we’ll keep Total under our lens.

Conclusion

Between BP and Total SA, Total looks stronger because of its consistent annual revenue and EPS growth, as well as the jump in its quarterly EPS in September 2012. Total wins this round in ourĀ “E-Squared” investment analysis.

“E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our successful CHEAT SHEET investing framework. Don’t waste another minute – click here to discover our CHEAT SHEET stock picks now!