Saudi Aramco stock unbothered despite a hit to profit in Q1

Saudi Arabian Oil Co (SAU: 2222) is trading up today even after reporting a hit to its profit in the first quarter.

Why is Saudi Aramco stock up today?

What’s more important to investors, it seems, is that the world’s largest oil and gas company, nonetheless, reported net income that topped expectations.

Saudi Aramco earned $31.9 billion in its recently concluded quarter – down 19% from a year ago on lower oil prices but handily ahead of $30.5 billion that experts had forecast. In the earnings press release, CEO Amin Nasser said:

We are leveraging cutting-edge technologies to increase liquids-to-chemicals capacity and meet anticipated demand for petrochemical products.

The energy giant also confirmed that its profit was up 3.75% sequentially in Q1. Year-to-date, Saudi Aramco stock is up 4.0% at writing.

Saudi Aramco to launch a new dividend

Saudi Aramco reported $30.9 billion in free cash flow for its first quarter – up slightly versus last year. CEO Nasser also said today:

We believe oil and gas will remain critical components of the global energy mix for the foreseeable future.

Last month, Fitch raised its long-term rating on this oil giant to “A+”. Saudi Aramco stock is up on Tuesday also because the company revealed plans of launching a performance-based quarterly dividend.

The stock market news arrives shortly after the oil and gas behemoth cited higher oil prices and reported a record $161 billion in net income for 2022 – a whopping 46.5% annualised growth.