Chevron: shares underperform after weak quarter

(CercleFinance.com) - Chevron shares are underperforming the US stockmarket on Friday morning, after the US oil giant posted a quarterly profit that missed expectations.


Net income in the third quarter was 2.6 billion dollars, or 1.36 dollar per share, compared with 4 billion dollars, or 2.11 dollars per share, a year earlier.

Meanwhile, analysts were expecting earnings of 1.45 dollar.

Oil-equivalent production came in at 3 million barrels per day in the third quarter, up 3% from 2.96 million barrels per day from a year ago.

"We view these results as a negative, given the company's weaker-than-expected cash flow in the quarter, and the 25% cost increase announced for the Tengiz future growth project (FGP) and project wellhead pressure management (PWPM) projects," analysts at Berenberg reacted.

Indeed, the company highlighted a 25% increase in the cost of the FGP/PWPM projects to a total of 45.2 billion dollars, from 36.8 billion dollars earlier, due to higher engineering and construction costs.

Shares of the San Ramon, California-based company were up just 0.2% at 116.3 dollars after these results, compared to a 1% rise in the Dow Jones index. The stock has risen by over 6% this year.

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