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3 Energy Stocks Poised to Outshine Earnings Estimates in Q4
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We are now at the beginning of the fourth-quarter earnings, with almost all the major oil companies yet to report results. As the pricing scenario was healthier year over year, better-than-expected results are expected from ConocoPhillips (COP - Free Report) . Midstream stock Enterprise Products Partners (EPD - Free Report) and refining firm PBF Energy (PBF - Free Report) are also in the spotlight.
Favorable Q4 Oil Price
Per data provided by the U.S. Energy Information Administration (“EIA”), the average West Texas Intermediate crude prices in October, November and December were recorded at $87.55 per barrel, $84.37 per barrel and $76.44 per barrel, respectively. In comparison, in the year-ago respective months, average oil prices were reported at $81.48 per barrel, $79.15 per barrel and $71.71 per barrel, per the EIA’s data.
Higher oil prices favored exploration and production activities, and convinced more explorers and producers to return to oil patches. The pricing scenario of natural gas was also healthy, depicting that the upstream business was lucrative in the fourth quarter.
How to Pick the Right Stocks?
Given the backdrop and amid a large number of energy stocks, it is by no means an easy task for investors to arrive at picks that have the potential to deliver better-than-expected earnings.
While there is no fool-proof method of picking outperformers, our proprietary methodology — the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — helps identify stocks that have high chances of delivering a positive surprise in their upcoming earnings announcement. Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.
The Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Our Choices
Enterprise Products Partners, a leading midstream energy player in North America, is likely to have generated stable fee-based revenues. The publicly traded partnership has low exposure to commodity price volatility.
Enterprise Products has an Earnings ESP of +1.95% and currently carries a Zacks Rank #3. It is scheduled to release fourth-quarter results on Feb 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Enterprise Products Partners L.P. Price and EPS Surprise
ConocoPhillips is a well-known name in the upstream business space and is likely to have benefited from favorable commodity prices in the December quarter. The firm, scheduled to report earnings on Feb 2,has an Earnings ESP of +0.67% and a Zacks Rank of 3.
In North America, PBF Energy is a leading independent refiner. The company is likely to have witnessed higher production of refined products, aiding higher gross refining margins. The firm, scheduled to release fourth-quarter earnings on Feb 16, has an Earnings ESP of +9.17% and a Zacks Rank #3.
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3 Energy Stocks Poised to Outshine Earnings Estimates in Q4
We are now at the beginning of the fourth-quarter earnings, with almost all the major oil companies yet to report results. As the pricing scenario was healthier year over year, better-than-expected results are expected from ConocoPhillips (COP - Free Report) . Midstream stock Enterprise Products Partners (EPD - Free Report) and refining firm PBF Energy (PBF - Free Report) are also in the spotlight.
Favorable Q4 Oil Price
Per data provided by the U.S. Energy Information Administration (“EIA”), the average West Texas Intermediate crude prices in October, November and December were recorded at $87.55 per barrel, $84.37 per barrel and $76.44 per barrel, respectively. In comparison, in the year-ago respective months, average oil prices were reported at $81.48 per barrel, $79.15 per barrel and $71.71 per barrel, per the EIA’s data.
Higher oil prices favored exploration and production activities, and convinced more explorers and producers to return to oil patches. The pricing scenario of natural gas was also healthy, depicting that the upstream business was lucrative in the fourth quarter.
How to Pick the Right Stocks?
Given the backdrop and amid a large number of energy stocks, it is by no means an easy task for investors to arrive at picks that have the potential to deliver better-than-expected earnings.
While there is no fool-proof method of picking outperformers, our proprietary methodology — the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — helps identify stocks that have high chances of delivering a positive surprise in their upcoming earnings announcement. Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.
The Earnings ESP shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Our Choices
Enterprise Products Partners, a leading midstream energy player in North America, is likely to have generated stable fee-based revenues. The publicly traded partnership has low exposure to commodity price volatility.
Enterprise Products has an Earnings ESP of +1.95% and currently carries a Zacks Rank #3. It is scheduled to release fourth-quarter results on Feb 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Enterprise Products Partners L.P. Price and EPS Surprise
Enterprise Products Partners L.P. price-eps-surprise | Enterprise Products Partners L.P. Quote
ConocoPhillips is a well-known name in the upstream business space and is likely to have benefited from favorable commodity prices in the December quarter. The firm, scheduled to report earnings on Feb 2,has an Earnings ESP of +0.67% and a Zacks Rank of 3.
ConocoPhillips Price and EPS Surprise
ConocoPhillips price-eps-surprise | ConocoPhillips Quote
In North America, PBF Energy is a leading independent refiner. The company is likely to have witnessed higher production of refined products, aiding higher gross refining margins. The firm, scheduled to release fourth-quarter earnings on Feb 16, has an Earnings ESP of +9.17% and a Zacks Rank #3.
PBF Energy Inc. Price and EPS Surprise
PBF Energy Inc. price-eps-surprise | PBF Energy Inc. Quote
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.