Chevron Corp earnings preview for 1QFY14

The company is expected to invest in LNG in the year, which might play well in the company’s favor.

Chevron Corporation (NYSE:CVX), States’ second-largest oil company is announcing their first quarter earnings for the fiscal year 2015 on Friday, May 1st. The California n-based company is expected to surpass its rival Exxon Mobile in terms of revealing the company’s future production planning.

The company is expected to heavily invest in liquefied natural gas (LNG), mostly is the Asian and Australian region. This may prove beneficial for the company’s disposal by help0ing as an off-set in the overall crude production stagnation.

LNG is transparent colorless liquid, widely used for heating purposes, powering vehicles and for generating electricity. The prices for LNG although did fall with the fuel costs, increased the gas’ demand in Chinese and Asian lands in order to limit pollution from other energy providing alternatives and also to spur economic growth.

According to Thomas Reuters consensus estimates of th e company, the oil giant is expected to have an EPS at $0.79 on $28.41 billion in revenue. During the presentation on analysts’ day in mid-March, Chevron made it clear that the company’s future plans are to increase its net production by 20% by 2017. This is interesting to ponder as from where the company is expecting to generate growth from, during the declining global demand. On the basis of current 2.6 million barrels of oil equivalent in a single day, the expected growth production works out to produce a total of 3.1 million barrels a day.

The net oil equivalent production for the oil company totaled to 2.57 million barrels per day previous year. Chevron also plans to reduce the budget 13% at $35billion, from 2014. During the fourth quarter of the FY14, the company’s earnings fell 30% to $3.5 billion from $4.9 billion YoY.

Currently, Zachs analysts’ estimates a consensus EPS at $0.74 for the company. The consensus price target is $114.07. Chevron shares were trading at $111.12 on Wednesday at 4:48AM, with a 52-week trading range of $98.88 to $135.10.