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This Week's Dow Earnings: Low Expectations For Exxon And Chevron

This Week's Dow Earnings: Low Expectations For Exxon And Chevron
  • More than a third of the Dow Jones Industrials are on deck to report quarterly results this week.
  • Wall Street expectations are particularly low for two supermajor oil companies.
  • Just one of these two companies beat earnings estimates in the previous quarter.

The third-quarter earnings reporting season is in full swing, and more than a third of the Dow Jones Industrial Average components have shared their latest results so far. Most of the rest of the 30 Dow members are on tap to report this week, and the Wall Street expectations are lowest for Chevron Corporation (NYSE: CVX), and Exxon Mobil Corporation (NYSE: XOM) as the sector struggles with slowly recovering oil prices.

The Wall Street consensus forecasts call for earnings at both supermajors to have dropped sharply year over year, in the period when OPEC agreed to a production freeze and Exxon caught the eye of the U.S. Securities and Exchange Commission.

When Chevron shares its third-quarter results, the Wall Street forecast is that its earnings per share (EPS) will have shrunk by more than 63 percent year over year to $0.45 per share, on $29.05 billion in revenue, which would be a more than 15 percent decline. Note that this integrated energy and chemicals company bested EPS estimates in the prior two quarters. But the estimate has dropped eight cents in the past 60 days.

The forecast from 23 Estimize respondents sees EPS from the California-based company coming in at $0.44. Also, the consensus revenue estimate for the three months that ended in September is $30.71 billion. However, Estimize, like Wall Street, narrowly overestimated Chevron's revenue in the previous two quarters.

Related Link: This Week's Dow Earnings: High Expectations For DuPont And Visa

Wall Street's consensus forecast for Exxon Mobil is for EPS to have slipped more than 33 percent from the same period of last year to $0.67, though that would be up from the $0.41 (a sizable miss) posted in the second quarter. The 60 Estimize respondents are a bit less optimistic, with an estimate of $0.64 per share for the period that ended in September.

Like Wall Street, Estimize narrowly overestimated Exxon's revenue back in the previous quarter, and this time the respondents are looking for $62.23 billion, which would be more than 8 percent lower than in the year-ago period. Wall Street is in the more pessimistic one here, with its consensus forecast of $61.34 billion. Wall Street does see top-line growth in the current quarter, but a decline for the full year.

Both Chevron and Exxon are scheduled to report their latest results before the opening bell on Friday.

Others This Week

Also this week, the consensus forecasts call for per-share earnings at Dow members Apple and Coca-Cola to be lower than a year ago as well. The EPS at Procter & Gamble are anticipated to be about the same as in the year-ago period.

On the other hand, the consensus forecasts call for EPS at Boeing, Caterpillar, DuPont, Merck, 3M, United Technologies and Visa to be larger than a year ago.

Only a handful of Dow components will be left to report after that, but watch for upcoming results from Cisco, Pfizer and Walt Disney.

At the time of this writing, the author had no position in the mentioned equities.

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