uploads///MUR FCF Trend

How Murphy Oil’s Free Cash Flow Is Trending



Murphy Oil’s normalized free cash flow in 2017

As we have seen in part one of this series, Murphy Oil (MUR) has normalized FCF (free cash flow) of ~14%, which is the third highest among the upstream producers in the US. In this part, we’ll study MUR’s free cash flow and normalized free cash flow trends.

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Murphy Oil’s free cash flow trend

In 3Q17, Murphy Oil (MUR) reported FCF (free cash flow) of -$47 million, which is lower when compared with MUR’s FCF of -$10 million in 3Q16. In the last four quarters, Murphy Oil’s (MUR) FCF showed an inverted U-shaped trend.

Murphy Oil’s normalized free cash flow trend

In the last one year, Murphy Oil’s (MUR) normalized FCF (free cash flow) decreased from -6% in 3Q16 to -21% in 3Q17. The decrease in MUR’s normalized FCF in the last four quarters can be attributed to the higher rise of ~55% in its capital expenditures compared to the 36% increase in cash from operations in the last four quarters.

Murphy Oil’s stock performance in 2017

Year-to-date in 2017, MUR’s stock is down ~0.8%. In comparison, the Energy Select Sector SPDR Fund (XLE), which represents an index of stocks across the energy sector, fell ~3.5%, and the SPDR S&P 500 ETF (SPY) rose ~21.8%.

Next, we will take a look at Devon Energy’s (DVN) free cash flow trends.


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