ConocoPhillips (NYSE:COP) Just Released Its Second-Quarter Earnings: Here's What Analysts Think

Last week, you might have seen that ConocoPhillips (NYSE:COP) released its quarterly result to the market. The early response was not positive, with shares down 4.6% to US$106 in the past week. Results look mixed - while revenue fell marginally short of analyst estimates at US$14b, statutory earnings beat expectations 2.6%, with ConocoPhillips reporting profits of US$1.98 per share. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for ConocoPhillips

After the latest results, the 15 analysts covering ConocoPhillips are now predicting revenues of US$59.7b in 2024. If met, this would reflect a reasonable 2.7% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to decrease 2.7% to US$8.94 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$59.4b and earnings per share (EPS) of US$8.47 in 2024. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.

The consensus price target was unchanged at US$140, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on ConocoPhillips, with the most bullish analyst valuing it at US$161 and the most bearish at US$112 per share. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the ConocoPhillips' past performance and to peers in the same industry. We would highlight that ConocoPhillips' revenue growth is expected to slow, with the forecast 5.5% annualised growth rate until the end of 2024 being well below the historical 20% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 2.5% per year. Even after the forecast slowdown in growth, it seems obvious that ConocoPhillips is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards ConocoPhillips following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on ConocoPhillips. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple ConocoPhillips analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - ConocoPhillips has 2 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com