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On January 2, Zacks Investment Research upgraded Cabot Oil and Gas Corporation (COG - Analyst Report) to a Zacks #1 Rank (Strong Buy).

Why the Upgrade?

Cabot Oil and Gas has been witnessing rising earnings estimates on the back of strong third-quarter 2012 results and an enhanced guidance for 2012 and 2013. The long-term expected sales growth rate for this stock is 4.97%    

Cabot Oil and Gas reported third quarter 2012 results on October 25, 2012. Earnings per share (excluding special items) of 17 cents passed the Zacks Consensus Estimate of 15 cents with positive earnings surprise of 13.33%. Cabot’s performance also improved considerably from the year-ago adjusted profit of 14 cents per share.

Earnings were primarily aided by enhanced output, increased oil prices and lower exploration costs.

Based on its progress, Cabot guides its 2012 volume growth in the range of 38% to 44%, including an expected liquid growth of 60% to 70%. For full-year 2013, the company expects to see production growth in the range of 35% to 50%, including a liquid growth of 45% to 55%.

For 2013, more than half of the estimates were revised higher over the last 60 days, lifting the Zacks Consensus Estimate by 8.33% to $1.17 per share.

Other Stocks to Consider

The following energy companies with favorable Zacks Rank are also performing well and are worth considering:

1)    Cheniere Energy Partners LP. (CQP - Snapshot Report) carries a Zacks #1 Rank (Strong Buy)
2)    Delek Us Holdings Inc (DK - Snapshot Report) holds a Zacks #1 Rank (Strong Buy).

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