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Noble Corp (NE) Q4 Earnings: Is a Surprise in the Cards?
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Noble Corporation plc (NE - Free Report) is expected to report fourth-quarter 2016 earnings around Feb 9, 2017, after the market closes.
Last quarter, the company posted a negative earnings surprise of 21.05%. In the last four quarters, Noble Corporation posted an average negative surprise of 32.23%. Let’s see how things are shaping up for this announcement.
Factors Likely to Influence this Quarter
The pricing scenario for natural gas was much better in the third quarter, both on a sequential and an annualized basis. However, oil prices were weaker than the July-September quarter of 2015. Despite the persistent weakness in crude, the commodity price improved significantly from the mid-February 2014 lows. The improvement in commodity prices is undoubtedly favorable for upstream energy players as these firms would now be able to carry on exploration and production activities by hiring more drillers. The developments in this front will likely be favorable for drillers like Noble Corp. and should have a positive impact on the upcoming earnings as well as going forward.
However, the offshore drilling industry is challenged with rig oversupply. This is a cause for concern for the likes of Noble Corp. as this could hamper contract flow and dayrates. In addition to this, major oil companies are lowering deep-water capital spending, which is worsening the situation.
Our proven model does not conclusively show that Noble Corp. is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -4.35%. This is because the Most Accurate Estimate stands at 24 cents while the Zacks Consensus Estimate is pegged at 23 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ExxonMobil currently has a Zacks Rank #3. Though a favorable Zacks Rank increases the predictive power of ESP, a negative Earnings ESP makes surprise prediction difficult.
Conversely, we caution against Sell-rated stocks (Zacks Ranks #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies from the energy space which according to our model have the right combination of elements to post an earnings beat this quarter:
Cimarex Energy Co. has an Earnings ESP of +1.72% and a Zacks Rank #3. It is expected to release earnings results on Feb 15.
Newfield Exploration Company has an Earnings ESP of +8.11% and a Zacks Rank #3. The company is expected to release earnings results on Feb 22.
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Noble Corp (NE) Q4 Earnings: Is a Surprise in the Cards?
Noble Corporation plc (NE - Free Report) is expected to report fourth-quarter 2016 earnings around Feb 9, 2017, after the market closes.
Last quarter, the company posted a negative earnings surprise of 21.05%. In the last four quarters, Noble Corporation posted an average negative surprise of 32.23%. Let’s see how things are shaping up for this announcement.
Factors Likely to Influence this Quarter
The pricing scenario for natural gas was much better in the third quarter, both on a sequential and an annualized basis. However, oil prices were weaker than the July-September quarter of 2015. Despite the persistent weakness in crude, the commodity price improved significantly from the mid-February 2014 lows. The improvement in commodity prices is undoubtedly favorable for upstream energy players as these firms would now be able to carry on exploration and production activities by hiring more drillers. The developments in this front will likely be favorable for drillers like Noble Corp. and should have a positive impact on the upcoming earnings as well as going forward.
However, the offshore drilling industry is challenged with rig oversupply. This is a cause for concern for the likes of Noble Corp. as this could hamper contract flow and dayrates. In addition to this, major oil companies are lowering deep-water capital spending, which is worsening the situation.
Noble Corporation Price and EPS Surprise
Noble Corporation Price and EPS Surprise | Noble Corporation Quote
Earnings Whispers
Our proven model does not conclusively show that Noble Corp. is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -4.35%. This is because the Most Accurate Estimate stands at 24 cents while the Zacks Consensus Estimate is pegged at 23 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ExxonMobil currently has a Zacks Rank #3. Though a favorable Zacks Rank increases the predictive power of ESP, a negative Earnings ESP makes surprise prediction difficult.
Conversely, we caution against Sell-rated stocks (Zacks Ranks #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies from the energy space which according to our model have the right combination of elements to post an earnings beat this quarter:
Suncor Energy Inc. (SU - Free Report) which is expected to release fourth-quarter earnings results on Feb 8, has an Earnings ESP of +9.52% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cimarex Energy Co. has an Earnings ESP of +1.72% and a Zacks Rank #3. It is expected to release earnings results on Feb 15.
Newfield Exploration Company has an Earnings ESP of +8.11% and a Zacks Rank #3. The company is expected to release earnings results on Feb 22.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>