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Apache (APA) Q3 Earnings: Permian Production Growth to Aid
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We expect Apache Corporation (APA - Free Report) to beat expectations when it reports third-quarter 2018 results after the close of trading on Wednesday, Oct 31. The current Zacks Consensus Estimate for the quarter under review is a profit of 43 cents per share on revenues of $1.9 billion.
In the preceding three-month period, the Houston, TX-based oil and gas finder beat the consensus mark by 42.9% on higher oil realizations and strong volumes from the key Permian Basin region.
In the preceding three-month period, the oil and gas finderbeat the consensus mark by 42.9% on higher oil realizations and strong volumes from the key Permian Basin region.
As far as earnings surprises are concerned, the Houston, TX-based upstream operator is on an excellent footing, having gone past the Zacks Consensus Estimate in each of the last four reports. This is depicted in the graph below:
Investors are keeping their fingers crossed and hoping that the company can continue winning ways by surpassing earnings estimate this time around too. Thankfully, our model indicates that Apache might beat on earnings in the third quarter.
Let’s delve deeper and find out the factors impacting the results.
Why a Likely Positive Surprise?
Our proven model shows that Apache is likely to beat the Zacks Consensus Estimate this quarter as it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and Zacks Rank #3 (Hold) or higher for increasing the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is +4.85%. A favorable Zacks ESP serves as a meaningful and leading indicator of a likely positive earnings surprise.
Zacks Rank: Apache currently has a Zacks Rank #2 (Buy), which, when combined with a positive ESP, makes us confident of earnings beat.
Note that we caution against stocks with a Zacks Ranks #4 or 5 (Sell rated) going into an earnings announcement, especially when the company is seeing a negative estimate revision.
What is Driving the Better-Than-Expected Earnings?
We believe that the improving commodity price environment and Apache’s strong production growth bode well.
We note that the Zacks Consensus Estimate of daily production for the company is currently pegged at 475 thousand oil-equivalent barrels (MBOE), up from 464 MBOE reported in the second quarter and the year-ago period’s 448 MBOE. In particular, we expect daily output from the Permian Basin – where Apache’s operations are focused – to average 220 MBOE during the third quarter, compared with 161 MBOE reported a year ago and 202 MBOE in the previous quarter.
Analysts polled by Zacks also envision realized prices to increase, which may further buoy the company’s top-line. The average oil price in the Permian is expected to improve 46.7% from the year-ago quarter to $67 per barrel.
Other Stocks to Consider
Apache is not the only energy company looking up this earnings season. Here are some firms from the space you may want to consider on the basis of our model, which shows that they have the right combination of elements to post earnings beat this quarter:
NOW Inc. (DNOW - Free Report) has an Earnings ESP of +5.61% and a Zacks Rank #2. The company is anticipated to release earnings on Nov 1.
Carrizo Oil & Gas, Inc. has an Earnings ESP of +0.18% and a Zacks Rank #2. The company is expected to release earnings on Nov 5.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Apache (APA) Q3 Earnings: Permian Production Growth to Aid
We expect Apache Corporation (APA - Free Report) to beat expectations when it reports third-quarter 2018 results after the close of trading on Wednesday, Oct 31. The current Zacks Consensus Estimate for the quarter under review is a profit of 43 cents per share on revenues of $1.9 billion.
In the preceding three-month period, the Houston, TX-based oil and gas finder beat the consensus mark by 42.9% on higher oil realizations and strong volumes from the key Permian Basin region.
In the preceding three-month period, the oil and gas finderbeat the consensus mark by 42.9% on higher oil realizations and strong volumes from the key Permian Basin region.
As far as earnings surprises are concerned, the Houston, TX-based upstream operator is on an excellent footing, having gone past the Zacks Consensus Estimate in each of the last four reports. This is depicted in the graph below:
Apache Corporation Price and EPS Surprise
Apache Corporation Price and EPS Surprise | Apache Corporation Quote
Investors are keeping their fingers crossed and hoping that the company can continue winning ways by surpassing earnings estimate this time around too. Thankfully, our model indicates that Apache might beat on earnings in the third quarter.
Let’s delve deeper and find out the factors impacting the results.
Why a Likely Positive Surprise?
Our proven model shows that Apache is likely to beat the Zacks Consensus Estimate this quarter as it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and Zacks Rank #3 (Hold) or higher for increasing the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is +4.85%. A favorable Zacks ESP serves as a meaningful and leading indicator of a likely positive earnings surprise.
Zacks Rank: Apache currently has a Zacks Rank #2 (Buy), which, when combined with a positive ESP, makes us confident of earnings beat.
Note that we caution against stocks with a Zacks Ranks #4 or 5 (Sell rated) going into an earnings announcement, especially when the company is seeing a negative estimate revision.
What is Driving the Better-Than-Expected Earnings?
We believe that the improving commodity price environment and Apache’s strong production growth bode well.
We note that the Zacks Consensus Estimate of daily production for the company is currently pegged at 475 thousand oil-equivalent barrels (MBOE), up from 464 MBOE reported in the second quarter and the year-ago period’s 448 MBOE. In particular, we expect daily output from the Permian Basin – where Apache’s operations are focused – to average 220 MBOE during the third quarter, compared with 161 MBOE reported a year ago and 202 MBOE in the previous quarter.
Analysts polled by Zacks also envision realized prices to increase, which may further buoy the company’s top-line. The average oil price in the Permian is expected to improve 46.7% from the year-ago quarter to $67 per barrel.
Other Stocks to Consider
Apache is not the only energy company looking up this earnings season. Here are some firms from the space you may want to consider on the basis of our model, which shows that they have the right combination of elements to post earnings beat this quarter:
Enbridge Inc. (ENB - Free Report) has an Earnings ESP of +5.26% and a Zacks Rank #1 (Strong Buy). The company is anticipated to release earnings on Nov 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
NOW Inc. (DNOW - Free Report) has an Earnings ESP of +5.61% and a Zacks Rank #2. The company is anticipated to release earnings on Nov 1.
Carrizo Oil & Gas, Inc. has an Earnings ESP of +0.18% and a Zacks Rank #2. The company is expected to release earnings on Nov 5.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>