Why Has Murphy Oil’s Stock Rallied 15% In A Fortnight?

November 22nd, 2019 by Trefis Team

Murphy Oil (MUR) is an oil and gas exploration company based in the U.S. The company significantly outperformed Q3 earnings estimates, with revenues coming at $817 million, a 66% increase year on year. With adjusted EBITDA clocking $438 million, this was the company’s most profitable quarter since Q4 2014. The strong performance for the recent quarter stands out as crude prices were around $59 for the period as opposed to a figure in excess of $100 in Q4 2014. The increased profitability came from higher off-take, higher realizations as well as lower lease expenses. An improvement in investor sentiments towards the company helped its stock price rally after the earnings release.

We step back from these recent swings to review Murphy Oil’s performance over the last few years, as a context for what might come next. Our Interactive dashboard – Why Has Murphy Oil’s Stock Jumped 15%? – reviews the near term reasons and the big picture.

 

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The context for the last few years:

A closer look At Murphy Oil’s Total Revenues over the last few years and the outlook 

Total Revenues for Murphy Oil significantly increased from $2.10 Bil in 2017 to $2.60 Bil in 2018; an increase of 22.6%.

This compares with Total Revenues growth of:

  • -47.3% in 2015 (on account of spin off of Murphy USA, along with decline in oil prices)
  • -35.1% in 2016 (on account of sale of UK downstream business)
  •  15.9% in 2017

We expect Total Revenues growth to be 10.1% in 2019.

 

A closer look at Murphy Oil’s Total Expenses over the last few years and the outlook

Total Expense for Murphy OIL increased from $2.03 Bil in 2017 to $2.1 Bil in 2018; an increase of 5.53%.

This compares with Total Expense growth of:

  • 50.4% in 2015 (significant increase in impairment costs, oil rig exit)
  • -62.1% in 2016 (Sale of UK downstream business)
  • -12% in 2017

We expect Total Expense growth to be 22.2% in 2019.

 

How does Murphy Oil (MUR) Revenue Growth compare with rivals?

For more information on how Murphy Oil’ revenue growth compares with Cabot Oil & Gas, Noble Energy and Whiting Petroleum Corporation , view our interactive dashboard analysis.

 

How has  Murphy Oil (MUR)  EBT trended?

EBT for Murphy Oil increased from $71.8 Mil in 2017 to $433 Mil in 2018.

We expect EBT to decrease by 50% to $217 Mil in 2019.

 

How has Murphy Oil (MUR) Net Income and EPS trended?

For more details about Murphy Oil Net Income and EPS, view our interactive dashboard analysis.

 

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