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Noble Energy (NBL) to Report Q1 Earnings: A Beat in the Cards?

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Noble Energy Inc. is scheduled to release first-quarter 2018 results on May 1. In the last reported quarter, the company pulled off a positive earnings surprise of 700%. We expect the company to report a positive earnings surprise this season

Why a Positive Surprise?

Our proven model shows that Noble Energy is likely to beat estimates this quarter as the stock has the right combination of the two key ingredients for this to happen — a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold).

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks ESP: Noble Energy has an Earnings ESP of +6.98% as the Most Accurate estimate of 28 cents is pegged higher than the Zacks Consensus Estimate of 26 cents.

Zacks Rank: The stock carries a Zacks Rank #3, which increases the predictive power of ESP. The combination of Noble Energy’s favorable Zacks Rank and positive ESP makes us reasonably confident of earnings beat this season.

Conversely, we caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Noble Energy Inc. Price and EPS Surprise

Factors to Consider

Noble Energy has taken initiatives to divest non-core assets and primarily concentrate on U.S. onshore and Eastern Mediterranean offshore assets, which might help boost its cash flow and margins. First-quarter U.S. onshore volumes are anticipated to be in line with the fourth quarter of 2017.

Noble Energy expects its first-quarter total sales volume in the range of 358-368 thousand barrels of oil equivalent per day (MBoe/d), of which, U.S. sales volume is estimated in the band of 260-274 Mboe/d. The Zacks Consensus Estimate for the first quarter’s total sales volume has decreased 5% sequentially to 361 MBOE/d.

The Zacks Consensus Estimate for first-quarter total revenues has increased 21.54% to $11.85 billion from the same period last year. Also, the Zacks Consensus Estimate projects earnings of 28 cents against a loss of 13 cents in the year-ago quarter.

Noble Energy has been divesting its non-core assets and the monetary gains from its past and ongoing divestments are enabling it to focus on core assets and carry out further development activities in these assets. The proceeds from these divestitures are aiding the company to lower its high level of existing debt burden.

Stocks to Consider

Here are a few players worth considering from the same industry with the right combination of elements to beat on earnings this time around:

EOG Resources, Inc. (EOG - Free Report) is expected to report first-quarter earnings 2018 on May 3. It has an Earnings ESP of +4.71% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Comstock Resources, Inc. (CRK - Free Report) has an Earnings ESP of +51.83% and a Zacks Rank #2. It is scheduled to report first-quarter 2018 earnings on May 14.

Energen Corporation has an Earnings ESP of +0.70% and a Zacks Rank #2. It is slated to report first-quarter 2018 earnings on May 8.

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