Exxon Mobil Corporation (XOM), Chevron Corporation (CVX): What’s Hiding in Big Oil’s Balance Sheet?

A much larger hidden asset on Big Oil’s balance sheet is BP plc (ADR) (NYSE:BP)’s 19.75% working interest in Russian oil giant Rosneft. BP acquired this stake when Rosneft bought out TNK-BP. As a shareholder in Rosneft, BP will earn its share in the company’s annual dividend. Unlike most dividends in the U.S., Rosneft pays out 25% of its annual net income once a year. For this year, BP will receive $460 million after Russian capital gains taxes, and the proceeds will be added to the company’s net income.

What a Fool believes
Using basic ratios and scanning financial statements can give you a rough idea of what’s going on with a company, but it may not necessarily tell the entire story. This is especially true for large companies like the integrated oil majors, which have several moving parts. Before making a decision on an investment, be sure to take a good look at the business beyond thumbing through a few valuation ratios. It’s likely that during your search you may come across a few half-truths and hidden gems.

The article What’s Hiding in Big Oil’s Balance Sheet? originally appeared on Fool.com.

Fool contributor Tyler Crowe has no position in any stocks mentioned. The Motley Fool recommends Chevron and Total. 

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