ConocoPhillips (COP), founded in 1917 and headquartered in Houston, Texas, is one of the world’s largest independent exploration and production companies. With a market cap of $119.7 billion, ConocoPhillips specializes in crude oil, natural gas, and natural gas liquids production, operating across six continents. The company is set to release its fourth-quarter earnings before the market opens on Thursday, Feb. 6.
Ahead of the event, analysts expect ConocoPhillips to announce a profit of $1.86 per share, down 22.5% from $2.40 per share reported in the year-ago quarter. The company has surpassed Wall Street’s EPS projections in three of the past four quarters while missing on one other occasion.
Its adjusted earnings of $1.78 per share in the last reported quarter outpaced the consensus estimates by 6%. Cost efficiencies and production management drove ConocoPhillips's earnings beat.
Analysts expect the energy company to report an EPS of $7.65 in fiscal 2024, down 12.8% from $8.77 in fiscal 2023. However, its EPS is projected to grow 4.4% year over year to $7.99 in fiscal 2025.
ConocoPhillips' shares have declined 3.7% over the past 52 weeks, significantly underperforming the S&P 500 Index's ($SPX) 25.8% gains and the Energy Select Sector SPDR Fund’s (XLE) 14.3% returns over the same period.
ConocoPhillips has faced underperformance due to regulatory scrutiny surrounding its Marathon Oil acquisition, oil price volatility, and post-acquisition integration challenges. Despite these hurdles, the company’s shares surged 6.4% after its Q3 earnings release on Oct. 31. Revenue dropped 12.1% year-over-year to $13.6 billion, falling short of Wall Street’s projection of $14.46 billion. The company generated $5.8 billion in cash generated from operating activities and $4.7 billion in cash from operations (CFO).
The consensus opinion on ConocoPhillips stock is bullish, with a “Strong Buy” rating overall. Out of the 28 analysts covering the stock, 23 recommend “Strong Buy,” two advise “Moderate Buy,” and three suggest a “Hold” rating. This configuration is more bullish than three months ago when it had 19 analysts suggesting a "Strong Buy."
The average target price for COP is $132.92, indicating a potential upside of 27.8% from the current price levels.
