The Zacks Analyst Blog Highlights: Exxon Mobil, Chevron, ConocoPhillips, Phillips 66 and Noble

CHICAGO, Nov. 5, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Exxon Mobil Corp. (NYSE:XOM-Free Report), Chevron Corp. (NYSE:CVX-Free Report), ConocoPhillips (NYSE:COP-Free Report), Phillips 66 (NYSE:PSX-Free Report) and Noble Corp. (NYSE:NE-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Tuesday's Analyst Blog:

Oil & Gas Stock Roundup

With earnings remaining front and center in the week, the major headlines came from Exxon Mobil Corp. (NYSE:XOM-Free Report) and Chevron Corp.'s (NYSE:CVX-Free Report) third quarter outperformance, where they saw off plunging oil prices to beat estimates on refining strength. 

Overall, it was a mixed week for the sector. West Texas Intermediate (WTI) crude futures declined by 1% – the seventh decrease in 8 weeks – to close at $80.24 per barrel. Natural gas prices gained 7.7% to $3.90 per million Btu (MMBtu). (See the last 'Oil & Gas Stock Roundup' here: Chevron Strikes Oil in GoM, Shell Offloads Nigeria Assets.)

Oil prices posted another weekly loss on plentiful supplies and lackluster demand expectations. Moreover, a stronger dollar has made the greenback-priced crude dearer for investors holding foreign currency. Oil traders got further spooked after Saudi Arabia cut its supply price to U.S. customers in the face of abundant North American output.

Natural gas, on the other hand, recovered from its 11-month low, as it shrugged off another above-average supply increase. The commodity was helped by expectations of strong heating demand with forecasts of chilly winter weather.

Recap of the Week's Most Important Stories

1. Integrated supermajors like Exxon Mobil Corp. and Chevron Corp. must be glad they did not let go their refineries. Both the companies reported strong third quarter earnings on improved downstream results that saw refining margins climb on lower input costs. But worryingly, the big firms continue to struggle to grow production despite spending billions in capital expenditures. Both the companies reported year-over-year decline in third quarter volumes.

2. Even as crude prices fell, ConocoPhillips (NYSE:COP-Free Report) – the largest U.S. independent oil and gas producer – reported better-than expected third quarter earnings. The outperformance validates ConocoPhillips' strategy realignment to get rid of non-core slow-growth assets in favor of acreage that they believe will give better returns over time.

The company's daily production averaged 1.481 million barrels of oil equivalent (MMBOE) in the quarter, up from 1.470 MMBOE in the year-ago quarter. ConocoPhillips plans to trim its next year capex by more than 4% from 2014 levels, while still managing to grow production by 3-5%. (See More: ConocoPhillips Q3 Earnings Beat Estimates, Revenues Miss.)

3. Downstream operator Phillips 66 (NYSE:PSX-Free Report) posted adjusted third-quarter 2014 earnings of $2.02 per share, substantially ahead of the Zacks Consensus Estimate of $1.69 and the year-ago earnings of 85 cents per share. Marked improvement in the company's refining segment and higher marketing margins led to the outperformance.

Phillips 66 announced that it has entered into two joint venture agreements with Energy Transfer Equity, L.P. and Energy Transfer Partners, L.P. to develop the Dakota Access Pipeline (DAPL) and Energy Transfer Crude Oil Pipeline (ETCOP) projects. The company, with 25% stake in the projects, will bear $1.2 billion in costs. These pipelines are expected to commence operations in the final quarter of 2016. (See More: Phillips 66 Earnings Beat Q3 Estimates on Higher Margins.)

4. Last week was an eventful one for contract driller Noble Corp. (NYSE:NE-Free Report), which not only posted upbeat third quarter profits but also announced its intention to form a master limited partnership (MLP) to enhance financial flexibility, plus expansion to its share buyback program.

The U.K.-registered firm rode higher dayrates to come out with earnings from continuing operations of 57 cents, surpassing the Zacks Consensus Estimate of 54 cents. Separately, the company outlined plans to pursue the formation of an MLP that would consist of certain rigs from its existing fleet. Noble expects to file a registration statement for an IPO in the U.S. by mid-2015. Further, the company is seeking approval from stockholders to repurchase up to 37 million shares.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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