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W&T Offshore (WTI) to Report Q4 Earnings: A Beat in Store?
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W&T Offshore, Inc. (WTI - Free Report) is expected to beat earnings estimates when it reports fourth-quarter 2020 results on Feb 25, after the closing bell.
In the last reported quarter, the company reported adjusted loss (excluding one-time items) of 14 cents per share, narrower than the Zacks Consensus Estimate of a loss of 24 cents due to lower costs and expenses. This was partially offset by a decline in average realized prices of commodities and lower oil equivalent production volumes. It beat estimates in all the last four quarters, delivering an average earnings surprise of 441.4%, as shown in the chart below.
Let’s see how things have shaped up prior to the announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for the company’s fourth-quarter loss per share of 13 cents has witnessed one upward revision and no downward movement in the past 30 days. This estimate is indicative of a 176.5% decrease from the year-ago reported figure.
The Zacks Consensus Estimate for its fourth-quarter revenues is pegged at $82.1 million, suggesting a decrease of 45.9% from the year-ago reported figure.
What the Quantitative Model Suggests
Our proven model predicts an earnings beat for W&T Offshore this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.
Earnings ESP: It has an Earnings ESP of +13.75%. This is because the Most Accurate Estimate for the quarter’s loss is pegged at 12 cents per share, while the Zacks Consensus Estimate for the same is a loss of 13 cents. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: W&T Offshore currently carries a Zacks Rank #3.
Factors Likely to Influence Q4 Results
In the fourth quarter, the upstream energy company brought back significant amount of production online ahead of schedule that was paused due to the storms in the Gulf of Mexico region. Moreover, output from its Magnolia field — which was acquired from ConocoPhillips (COP - Free Report) — was restored during the quarter, owing to which total quarterly production should exceed the prior projected level.
Per the operational update, W&T Offshore’s fourth-quarter production volumes are expected in the range of 34,700-36,900 barrels of oil equivalent per day (Boe/d). Of the total volumes, 34% is expected to be oil, while 11% and 55% are likely to be natural gas liquids and natural gas, respectively. Notably, the guidance indicates an improvement from third-quarter volumes.
However, the expected range indicates a decline from the year-ago production of 52,773 Boe/d. Resultantly, it is likely to record a year-over-year decline in income. However, the potential rise in total production can position the company for an earnings beat. This will likely be further supported by improving crude prices. Importantly, through the fourth quarter, crude prices recovered nearly 26%.
Other Stocks That Warrant a Look
Here are some other firms that you may want to consider as these too have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Talos Energy Inc. (TALO - Free Report) has an Earnings ESP of +13.75% and is a Zacks #3 Ranked player. The company is scheduled to release fourth-quarter results on Mar 10.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Image: Bigstock
W&T Offshore (WTI) to Report Q4 Earnings: A Beat in Store?
W&T Offshore, Inc. (WTI - Free Report) is expected to beat earnings estimates when it reports fourth-quarter 2020 results on Feb 25, after the closing bell.
In the last reported quarter, the company reported adjusted loss (excluding one-time items) of 14 cents per share, narrower than the Zacks Consensus Estimate of a loss of 24 cents due to lower costs and expenses. This was partially offset by a decline in average realized prices of commodities and lower oil equivalent production volumes. It beat estimates in all the last four quarters, delivering an average earnings surprise of 441.4%, as shown in the chart below.
W&T Offshore, Inc. Price and EPS Surprise
W&T Offshore, Inc. price-eps-surprise | W&T Offshore, Inc. Quote
Let’s see how things have shaped up prior to the announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for the company’s fourth-quarter loss per share of 13 cents has witnessed one upward revision and no downward movement in the past 30 days. This estimate is indicative of a 176.5% decrease from the year-ago reported figure.
The Zacks Consensus Estimate for its fourth-quarter revenues is pegged at $82.1 million, suggesting a decrease of 45.9% from the year-ago reported figure.
What the Quantitative Model Suggests
Our proven model predicts an earnings beat for W&T Offshore this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.
Earnings ESP: It has an Earnings ESP of +13.75%. This is because the Most Accurate Estimate for the quarter’s loss is pegged at 12 cents per share, while the Zacks Consensus Estimate for the same is a loss of 13 cents. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: W&T Offshore currently carries a Zacks Rank #3.
Factors Likely to Influence Q4 Results
In the fourth quarter, the upstream energy company brought back significant amount of production online ahead of schedule that was paused due to the storms in the Gulf of Mexico region. Moreover, output from its Magnolia field — which was acquired from ConocoPhillips (COP - Free Report) — was restored during the quarter, owing to which total quarterly production should exceed the prior projected level.
Per the operational update, W&T Offshore’s fourth-quarter production volumes are expected in the range of 34,700-36,900 barrels of oil equivalent per day (Boe/d). Of the total volumes, 34% is expected to be oil, while 11% and 55% are likely to be natural gas liquids and natural gas, respectively. Notably, the guidance indicates an improvement from third-quarter volumes.
However, the expected range indicates a decline from the year-ago production of 52,773 Boe/d. Resultantly, it is likely to record a year-over-year decline in income. However, the potential rise in total production can position the company for an earnings beat. This will likely be further supported by improving crude prices. Importantly, through the fourth quarter, crude prices recovered nearly 26%.
Other Stocks That Warrant a Look
Here are some other firms that you may want to consider as these too have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Canadian Natural Resources Limited (CNQ - Free Report) has an Earnings ESP of +61.54% and a Zacks Rank
of#3, currently. The company is scheduled to release quarterly earnings on Mar 4. You can see the complete list of today’s Zacks #1 Rank stocks here.Talos Energy Inc. (TALO - Free Report) has an Earnings ESP of +13.75% and is a Zacks #3 Ranked player. The company is scheduled to release fourth-quarter results on Mar 10.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Click here to download this report FREE >>