33% of S&P 500 Companies Mentioning Oil In Earnings Reports, Up 37% From Year Ago
33% of S&P 500 Companies Mentioning Oil In Earnings Reports, Up 37% From Year Ago
More S&P companies commenting on oil
"As you all know, the price of oil has dropped about $30 a barrel. It is $1 trillion stimulus per year to the world's economy." -Pioneer Natural Resources (Nov. 5)
"As everyone knows, oil prices dropped considerably over the last couple of months and WTI future prices are now below $80 both short and long term. Of course finally, the equity valuations of oil companies have dropped significantly including ours." -Denbury Resources (Nov.5)
During the past week (on November 4), the price of crude oil (NYM) (USO) settled at a 3-year low price of $77.19. This drop in price continued a trend of falling oil prices over the past few months. Since September 30, the price of crude oil has fallen 14.1% (to $77.91 from $91.16). During this same time frame, the projected earnings growth rate for the Energy sector (XLE) in the S&P 500 (SPX) (SPY) for Q4 2014 has dropped to -7.6% today from 7.2% on September 30, as analysts have slashed earnings estimates for companies in this sector.
Given the decrease in the price of oil and the decline in the earnings expectations, are companies in the S&P 500 discussing the price of oil more frequently? How often has "oil" been mentioned in recent earnings conference calls?
Searching through all earnings conference call transcripts for S&P 500 companies between September 1, 2014 and November 6, 2014, the term "oil" was mentioned at least once in 144 conference calls (out of 438 total). This number reflects an increase of 37% over the year ago period (September 1, 2013 through November 6, 2013), when the term was mentioned in 105 conference calls (out of 426 total).
At the sector level, the Energy (39) and Industrials (33) (XLI) sectors had the highest number of conference calls in which the term "oil" was cited. However, the Materials (+11) (XLB) sector actually saw the largest year-over-year increase in the number of companies citing the term "oil" during conference calls.
[BigTrends.com note: You can also see on the table below that Financials (XLF), Consumer Discretionary (XLY) and Consumer Staples (XLP) also saw big year-over-year (YOY) relative increases in the mention of oil.]
Courtesy of FactSet.com