This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Big Oil Earnings Will Be as Boring as Ever

NEW YORK ( TheStreet) -- Some headlines related to Big Oil never change.

President Obama says Exxon Mobil (XOM) and its peers make way too much money and are getting away with the equivalent of tax break murder .

The press highlights just how big those Big Oil profits really are with comparisons to various GDP equivalents. This week it was The New Yorker's turn to note that Exxon Mobil's annual revenue is equal to the GDP of Norway.

Big Oil companies will post the usual big profit numbers in the first quarter, but it won't matter much to the Big Oil investment story.

Then there is Big Oil earnings season, which is about to begin. The headlines will focus on the huge numbers posted by the world's biggest oil companies but there is a better way to trade these behemoths.

Big Oil stocks remain best played as dividend yield investments -- and as a less volatile way to play the energy sector than the independent exploration and production companies. For investors, earnings day is usually a bigger headline than the actual event merits. Big Oil earnings tend to be "blah" at best.

In fact, it's much more likely that a negative catalyst in any production hiccup or downward revision of production guidance will spark a sell-off during earnings season than it is that a big beat buoyed by high crude prices will send Big Oil shares higher.

It's reached the point where Big Oil earnings lead to a "broken record" from Wall Street analysts: Earnings just isn't a needle-moving event for these companies, where long-term production growth can't be budged quarter to quarter, and any short-term outperformance from the downstream segment -- refining and marketing -- is part of a cycle that can swing back around from quarter to quarter.

With the interim earnings reports now on the books from ConocoPhillips (COP) and Chevron (CVX), it looks like the Big Oil earnings day narrative will once again play out along these lines.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs