Imperial Looks Attractive

Article Excerpt

IMPERIAL OIL $40.32 (Toronto symbol IMO; Shares outstanding: 869.7 million; Market cap: $35.1 billion; SI Rating: Average) is Canada’s largest integrated oil company. Imperial also operates 2,000 retail gas stations under the “Esso” banner. In the three months ended September 30, 2008, earnings per share rose 78.4%, to a record $1.57 from $0.88. The improvement came from higher oil and gas prices, plus higher profit margins at the company’s refining and chemical operations. Revenues rose 48%, to $9.5 billion from $6.4 billion. Imperial’s cash flow rose 78.5%, to $1.7 billion from $958 million in the latest quarter. Cash flow per share rose 87.5%, to $1.95 from $1.04, due to continued aggressive stock buybacks. Imperial’s cash flow will likely fall in the next quarter, along with lower oil and gas prices. Oil prices hit a record high of $147 U.S. a barrel in July, 2008, but have since fallen to around $65. Still, Imperial’s production is set to rise, thanks to the company’s new oil…

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