ConocoPhillips (COP) Beats Q3 Earnings Estimates, Ups Dividend

Zacks Equity Research

November 3, 2022 at 9:42 AM·5 min read

ConocoPhillips COP has reported third-quarter 2022 adjusted earnings per share of $3.60, beating the Zacks Consensus Estimate of $3.41. The bottom line surged from the prior-year quarter’s $1.77 per share.

One of the world’s largest independent oil and gas producers based in Houston, TX, ConocoPhillips’ quarterly revenues of $21,614 million increased from third-quarter 2021 sales of $11,616 million. Also, the top line beat the Zacks Consensus Estimate of $17,052 million.

The strong quarterly results have been aided by higher oil-equivalent production volumes and realized commodity prices.

ConocoPhillips Price, Consensus and EPS Surprise

ConocoPhillips price-consensus-eps-surprise-chart | ConocoPhillips Quote

Dividend Hike & Share Repurchases

ConocoPhillips has announced a quarterly ordinary dividend of 51 cents per share, indicating a 10.9% increase from the last paid 46 cents. The dividend is payable on Dec 1, 2022, to stockholders of record at the close of business on Nov 15, 2022. Additionally, COP announced a variable return of cash payment of 70 cents per share.

The company’s board of directors approved a $20-billion increase in the existing share repurchase program to $45 billion.

Production

Total production averaged 1,754 thousand barrels of oil equivalent per day (MBoe/d), up from the year-ago quarter’s 1,544 MBoe/d. Of the total output, 51% was crude oil. Overall production was higher than the year-ago period primarily due to the significantly increased production in the Lower 48.

ConocoPhillips’ crude oil production was 895 thousand barrels per day (MBbls/d), higher than the year-ago quarter’s 815 MBbls/d. Production of natural gas liquids totaled 271 MBbls/d, higher than the year-ago period’s 130 MBbls/d. Bitumen production for the quarter was 69 MBbls/d, unchanged from the year-ago quarter. However, the company’s natural gas output was 3,113 million cubic feet per day (MMcf/d), lower than the year-ago level of 3,177 MMcf/d.

Realized Prices

Average realized oil equivalent prices rose to $83.07 per barrel from the year-ago level of $56.92.

The average realized crude oil price for the third quarter was $97.56 per barrel, reflecting a significant increase from the year-ago figure of $70.43. Realized natural gas liquids price was $35.47 per barrel, higher than the year-ago quarter’s $34.79. The average realized natural gas price for third-quarter 2022 was $13.04 per thousand cubic feet, up from the year-ago period’s $5.94. The average realized bitumen price was $49.77 per barrel, reflecting an increase from the year-ago level of $41.19.

Total Expenses

ConocoPhillips’ third-quarter total expenses rose to $14,174 million from $8,034 million in the corresponding period of 2021.

Production and operating expenses rose to $1,799 million for the reported quarter from $1,389 million a year ago. Similarly, the cost of purchased commodities rose to $9,251 million for the quarter from $4,179 million a year ago. Exploration costs increased to $89 million for the September-end quarter of 2022 from $65 million in the comparable period of 2021.

Balance Sheet & Capital Spending

As of Sept 30, 2022, ConocoPhillips had $8,010 million in cash and cash equivalents. The company had a total long-term debt of $16,297 million. It had a debt-to-capitalization ratio of 0.257. At the third-quarter end, the company had short-term debt of $664 million.

Capital expenditure and investments totaled $2,497 million, and dividend payments grossed $1,484 million. Net cash provided by operating activities was $8,740 million.

Guidance

For 2022, ConocoPhillips reiterated its production guidance of 1.74 million barrels of oil equivalent per day (MMBoe/d). For the fourth quarter, ConocoPhillips expects production between 1.74 MMBoe/d and 1.80 MMBoe/d.

Zacks Rank & Stocks to Consider

ConocoPhillips currently carries a Zacks Rank #3 (Hold).

Investors interested in the energy sector might look at the following companies that presently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

RPC Inc. RES reported adjusted earnings of 32 cents per share in the third quarter, beating the Zacks Consensus Estimate of 25 cents. The strong quarterly results were backed by higher activity levels in all the service lines and improved pricing.

With no debt load, RPC had cash and cash equivalents of $35.9 million at the third-quarter end. This reflects the company’s strong balance sheet that provides it with massive financial flexibility. It allows RPC to remain afloat during tough times.

Oceaneering OII reported a third-quarter 2022 adjusted profit of 23 cents per share, beating the Zacks Consensus Estimate of a profit of 13 cents. The outperformance was largely due to robust results in certain segments.

For 2022, Oceaneering projects consolidated EBITDA of $215-$240 million and continued significant free cash flow generation of $25-$75 million.

Halliburton Company HAL reported a third-quarter 2022 adjusted net income per share of 60 cents, surpassing the Zacks Consensus Estimate of 56 cents. The outperformance reflected stronger-than-expected profit from its divisions.

Halliburton expects international activity to gain momentum throughout the globe. The company’s state-of-the-art portfolio, selective contract wins and balanced geographic mix will help it maximize profit from the upcycle. As far as North America is concerned, HAL sees continued revenue growth in a tight market.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Halliburton Company (HAL) : Free Stock Analysis Report

ConocoPhillips (COP) : Free Stock Analysis Report

Oceaneering International, Inc. (OII) : Free Stock Analysis Report

RPC, Inc. (RES) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

Politico
Noem: ‘They’re just attacking me like crazy right now.’
The South Dakota governor has come under intense criticism for her decision to shoot and kill her dog 20 years ago.
Associated Press
Berkshire's profit plunges 64% on portfolio holdings as Buffett it sells Apple
Berkshire Hathaway's first quarter profits plummeted along with the paper value of its investments, but the company said Saturday that most of the businesses it owns outright performed well. The figures were heavily influenced by a large drop in the paper value of Berkshire’s investments. Buffett encourages investors to pay more attention to the conglomerate’s operating earnings that exclude the investment figures.
Associated Press
Escaped zebra captured near Seattle after gallivanting around Cascade mountain foothills for days
A zebra that has been hoofing through the foothills of western Washington for days was recaptured Friday evening, nearly a week after she escaped with three other zebras from a trailer near Seattle. Local residents and animal control officers corralled the zebra named “Shug” in the community of Riverbend, about 30 miles (48 kilometers) east of Seattle, the Regional Animal Services of King County wrote on its website.
AFP
Scholz says attacks on deputies 'threaten' democracy
German Chancellor Olaf Scholz on Saturday condemned an attack on one of his party's European Parliament deputies as a "threat" to democracy after investigators said a political motive was suspected."If an attack with a political motive... is confirmed just a few weeks from the European elections, this serious act of violence would also be a serious act against democracy," Interior Minister Nancy Faeser said in a statement.
CNN
At least 57 people killed, hundreds missing as heavy rain and flooding lashes Brazil
Muddy brown waters have risen as high as rooftops in some areas after days of rain, while rescue teams have been out on inflatable rafts on roads turned to rivers.
CNN
Evacuations ordered, homes damaged in Texas as rivers surge to Hurricane Harvey levels. And more rain is on the way
Flooding is intensifying in Texas, where more rain is expected over the weekend in the wake of strong storms and downpours that swept away vehicles, damaged homes and triggered evacuations.
AFP
Death toll in southern Brazil flood rises to 58
The death toll from floods and mudslides triggered by torrential storms in southern Brazil has climbed to 58 people, with the major city of Porto Alegre particularly hard-hit, the country's civil defense agency said Saturday.Overall, raging floodwaters have left 74 people injured and another 67 missing, the civil defense agency said.
Associated Press
A look at commencement ceremonies as US campuses are roiled by protests over the Israel-Hamas war
Commencement ceremonies are being held at colleges and universities across the U.S. As many campuses have been roiled by protests over the Israel-Hamas war, some school administrations have taken steps to contain disruptions during their commencement activities. University of Michigan's commencement was held early Saturday with a few interruptions. Ahead of the ceremony, the school had said staff and security officers were ready to respond and that interfering with commencement would not be considered free speech.
CNN
Escaped zebra captured after nearly a week on the lam
A zebra’s almost week-long Washingtonian adventure came to an end on Friday, when the animal was recaptured after escaping from a trailer on the highway, according to local authorities.
Associated Press
Small anti-war protest ruffles University of Michigan graduation ceremony
Protesters chanted anti-war messages and waved Palestinian flags during the University of Michigan's commencement Saturday, as student demonstrations against the Israel-Hamas war collided with the annual pomp-and-circumstance of graduation ceremonies. No arrests were reported and the protest — comprised of about 50 people, many wearing traditional Arabic kaffiyeh along with their graduation caps — didn’t seriously interrupt the nearly two-hour event at Michigan Stadium in Ann Arbor, which was attended by tens of thousands of people. One protest banner read: “No universities left in Gaza.”
Associated Press
Boeing locks out its private firefighters around Seattle over pay dispute
Boeing has locked out its private force of firefighters who protect its aircraft-manufacturing plants in the Seattle area and brought in replacements after the latest round of negotiations with the firefighters' union failed to deliver an agreement on wages. The company said Saturday that it locked out about 125 firefighters and a facility about 170 miles (275 kilometers) away in central Washington. The firefighters serve as first responders to fires and medical emergencies and can call in help from local fire departments.
AFP
Israel army says five Palestinians killed in West Bank raid
The Israeli army said troops killed five Palestinian "terrorists" barricaded in a building during a 12-hour siege in the occupied West Bank on Saturday.At least 496 Palestinians have been killed in the territory by Israeli troops or settlers, according to an AFP tally.
NBC News
California man charged with threatening Fulton County District Attorney Fani Willis
A California man was indicted by a federal grand jury in Atlanta on charges of threatening Fulton County District Attorney Fani Willis, the U.S.
NBC News
Flood watch extended for Houston as more heavy rain is expected throughout weekend
A flood watch has been extended into Sunday for Houston following catastrophic flooding that turned backyards and streets into rivers and prompted water rescues in nearby communities.
AFP
History maker Sadiq Khan: a mayor with global renown
Sadiq Khan, who was Saturday re-elected for a record third term as London mayor, rose from humble roots to spar with world leaders and bring consequential change to the British capital. "It's the honour of my life to serve the city that I love and I'm beyond humbled right now," he told supporters Saturday, adding he wanted "to repay the trust you've placed in me" and deliver a "fairer, safer and greener" capital.
Yahoo News
How to watch the Eta Aquarids, the annual meteor shower that peaks this weekend
What to know about the annual meteor event known as the Eta Aquarids.
Yahoo Finance
What the Tesla Supercharger layoffs could mean for America's EV buildout
The latest layoffs at Tesla this week cut close to the bone of the EV pioneer’s big competitive advantage — its ubiquitous Supercharger network.
Politico
There’s progress reported in Gaza truce talks, but Israel downplays chances of ending war with Hamas
Egyptian and U.S. mediators have reported signs of compromise in recent days, but chances for a cease-fire deal remain entangled.
AFP
Spain and Argentina at loggerheads in diplomatic spat
Spain and Argentina were at diplomatic daggers drawn on Saturday as the two countries traded barbs over drug taking and economic decline.Milei's anger this time appears to have been sparked by comments by Spain's transport minister linking the president to drug taking.
Yahoo Finance
Warren Buffett pays tribute to Charlie Munger on a 'tough day' for shareholders
This year’s Berkshire Hathaway annual shareholder meeting marked a new era for the Oracle of Omaha, Warren Buffett. It’s the investing legend’s first without his right-hand man, Charlie Munger.