In an April 29 research report, Raymond James analyst John Freeman reported that Anadarko Petroleum Corp. (APC:NYSE) intends to resume negotiations with Occidental Petroleum Corp. (OXY:NYSE), which submitted a competing acquisition bid on April 24, 2019.
Freeman noted further that Anadarko's board concluded that "Occidental's proposal could reasonably be expected to result in a 'superior bid' relative to the terms of Anadarko's agreement with Chevron." Should that be the case, Chevron Corp. (CVX:NYSE) would have four days to respond to Occidental's loftier proposal with one of its own.
In other news, Freeman indicated, Anadarko posted "strong" numbers for Q1/19, "delivering a beat across the board on production, earnings and capital expenditures." These achievements resulted in a Q1/19 adjusted earnings per share for Anadarko of $0.53, twice that of consensus' $0.24 forecast.
Specifically, production was about 3% higher than Raymond James and the Street's forecasts, and showed outperformance in all commodities. Also positive, Q1/19 operating expenses were lower than expected, with lease operating expenses per barrel of oil equivalent coming in at about 10% below the midpoint of Q1/19 guidance.
Raymond James has a Market Perform rating but no target price on Anadarko.
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Disclosures from Raymond James, Anadarko Petroleum Corp., April 29, 2019
ANALYST INFORMATION
Analysts Holdings and Compensation: Equity analysts and their staffs at Raymond James are compensated based on a salary and bonus system. Several factors enter into the bonus determination, including quality and performance of research product, the analyst's success in rating stocks versus an industry index, and support effectiveness to trading and the retail and institutional sales forces. Other factors may include but are not limited to: overall ratings from internal (other than investment banking) or external parties and the general productivity and revenue generated in covered stocks.
The analyst John Freeman, primarily responsible for the preparation of this research report, attests to the following: (1) that the views and opinions rendered in this research report reflect his or her personal views about the subject companies or issuers and (2) that no part of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views in this research report. In addition, said analyst(s) has not received compensation from any subject company in the last 12 months.
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Certain affiliates of the RJ Group expect to receive or intend to seek compensation for investment banking services from all companies under research coverage within the next three months.
Raymond James & Associates, Inc. makes a market in the shares of Anadarko Petroleum Corporation, Chevron Corporation and Occidental Petroleum Corporation.
The covering analyst and/or research associate owns shares of the common stock of Chevron Corp.
