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The Zacks Analyst Blog Highlights: Chevron, Exxon Mobil, Phillips 66, Marathon Petroleum and Rowan

Zacks Equity Research

For Immediate Release
Chicago, IL – February 05, 2014 – 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 Chevron Corp. ( CVX- Free Report), Exxon Mobil Corp. ( XOM- Free Report), Phillips 66 ( PSX- Free Report), Marathon Petroleum Corp. ( MPC- Free Report) and Rowan Companies plc ( RDC- 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

Crude prices moved up during the past week on expectations of an improving economy, while the recent natural gas rally took a breather on forecasts of a break in colder temperatures.

Among the newsmakers, Chevron Corp. ( CVX- Free Report) shares tanked after reporting weak fourth-quarter results. 
Crude Oil:

Crude prices increased last week on Federal Reserve’s Taper announcement Wednesday afternoon. The central bank – working on the premise that the U.S. economy was strong enough – stated that it will reduce bond repurchases by a further $10 billion, bringing its monetary stimulus to $65 billion a month from February.

This has fueled hopes for robust fuel and energy demand in the world’s biggest oil consumer. The bullish momentum was propelled by Thursday’s positive reading of fourth quarter initial GDP numbers.

Sentiments were further brightened by the Energy Information Administration ( EIA) report that showed a drop in fuel (gasoline and distillate) supplies, which outweighed an increase in oil inventories.

However, at the same time, crude prices were pressured by a possible slowdown in China’s manufacturing sector and concerns surrounding the health of emerging markets.

As a result of these factors, by close of trade on Friday, West Texas Intermediate ( WTI) oil was slightly in the black and settled at around $97.50 per barrel, gaining 1% for the week. 

Natural Gas:

Natural gas fell last week, pulled down by a tepid supply data and forecasts of a break in cold weather conditions.

The EIA's weekly inventory release showed that natural gas stockpiles held in underground storage in the lower 48 states fell by 230 billion cubic feet (Bcf) for the week ended Jan 24. However, the reduction could not beat the guided range (of 228–232 Bcf drawdown) despite the cold snap that hit many cities during the period.

Moreover, milder weather forecasts – in bulk of the country over the next few days – are likely to limit natural gas’ demand for heating.

Influenced by these factors, natural gas spot prices ended Friday at around $4.95 per million Btu (MMBtu), down 4.5% over the week.

Energy Week That Was:

The week’s energy coverage was dominated by the following news:

‘Big Oil’ Disappoints in Q4

Among the integrated supermajors, Chevron Corp. and Royal Dutch Shell plc posted weak fourth quarter results on falling production and refinery margins. Chevron was the major loser, as shares fell 4% in Friday trading. Exxon Mobil Corp. ( XOM- Free Report) – the largest U.S. oil company by market value – was the exception, as it managed to brush past the Zacks Consensus Estimate on the back of higher natural gas prices. However, output and downstream profitability were down from the year-ago period.  

Refiners Beat Estimates

Refining giants Phillips 66 ( PSX- Free Report), Marathon Petroleum Corp. ( MPC- Free Report) and Valero Energy Corp. all reported better-than-expected fourth-quarter earnings, as increased throughput volumes and improved operating activities more than made up for lower margins.

Rowan Companies Initiates Dividend

The board of directors of Rowan Companies plc ( RDC- Free Report), a provider of offshore contract drilling services, initiated a quarterly cash dividend of 10 cents per outstanding share of common stock. The first dividend is expected to be paid in the second quarter of 2014. Rowan’s decision to initiate a quarterly dividend reflects its steady earnings growth from its well positioned jackup fleet and entry into the ultra-deepwater market with four highly capable drillships.

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

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