Market Overview

Energy Stocks in Focus: Hess, Chesapeake Energy, Marathon Petroleum and Phillips 66

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Between earnings, corporate conversions, dividends, share buybacks, and management shake-ups, energy stocks are in focus Wednesday.

Specifically, Hess (NYSE: HES), Chesapeake Energy (NYSE: CHK), Marathon Petroleum Corp. (NYSE: MPC), and Phillips 66 (NYSE: PSX) are in focus Wednesday.

Hess has been in the headlines this morning for a few reasons. Yesterday, Benzinga reported that the company was the subject of an activist investor onslaught from Elliot Management. The firm wanted to take up to 6 board seats and sell off key assets to maximize value for the firm.

Wednesday morning, Hess reported fourth quarter earnings that slightly missed analyst estimates. For the quarter, Hess reported earnings per share of $1.20 compared to the $1.21 forecasted by analysts. Revenue was also weak at $9.51 billion, below the forecasts of $9.63 billion. Hess shares rose 2.3 percent pre-market to $69.67 per share, just below the 52-week high at $70.77 per share.

Chesapeake Energy was also the subject of management shake-up Tuesday as the company reported after the close that founder and CEO Aubrey McClendon was to step down from his roles and retire.

The news comes months after activist investor Carl Icahn bought a significant stake in the company and raises speculation as to whether McClendon actually retired or was forced out in a coup led by Icahn and his associates. Chesapeake shares rose 10.44 percent pre-market to $20.95 per share.

Marathon Petroleum Corp. reported earnings Wednesday morning that beat analyst expectations and shares rose. For the fourth quarter, Marathon Petroleum Corp. reported earnings per share of $2.26 compared to analyst forecasts of $2.10 per share on stronger than expected revenue of $20.7 billion.

Marathon also announced that it was returning capital to shareholders in the form of dividends and stock buybacks. The company declared a $0.35 per share dividend payable March 11 to shareholders of record as of February 20.

Also, the company authorized an additional $2 billion in share buybacks bringing the total buyback program to $2.65 billion for the next year. Marathon shares rose in the pre-market 1.49 percent to $73.04 per share, an all-time high.

Phillips 66, the refining company spun out of ConocoPhillips (NYSE: COP) in May 2012, also reported earnings that beat estimates. For the fourth quarter, Phillips 66 reported earnings per share of $2.06, beating analyst estimates of $1.68 by $0.38 per share.

Also, the company announced its intention to convert to a Master Limited Partnership (MLP), meaning that it would be required to return more capital to shareholders. Shares rose 1.8 percent pre-market to $60.98 per share, a new 52-week and all-time high.

Posted-In: Earnings News Guidance Dividends Commodities Buybacks Asset Sales Management Best of Benzinga

 

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