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How is Williams Companies (WMB) Placed Ahead of Q3 Earnings?
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The Williams Companies, Inc. (WMB - Free Report) is set to release third-quarter 2020 results on Monday Nov 2, after the closing bell.
The Zacks Consensus Estimate for the to-be-reported quarter’s profit is 27 cents per share and for revenues is $1.77 billion.
Against this backdrop, let’s consider the factors that are likely to impact the company’s September-quarter results.
Factors to Consider for Q3 Results
Williams’ Northeast G&P segment, which engages in natural gas gathering and processing along with the NGL fractionation business in Marcellus and Utica shale regions, is likely to have performed well in the third quarter, a trend that most likely continued sequentially. The Zacks Consensus Estimate for the unit’s third-quarter adjusted EBITDA is pegged at $363 million, indicating a 5.8% rise from the year-ago quarter’s reported figure of $343 million.
However, the company’s Westunitconsisting of Northwest pipeline and operations in various regions, such as Colorado, Mid-Continent and Haynesville Shale among others generated adjusted EBITDA of $252 million in the second quarter, down 12.2% from $287 million in the year-ago quarter. Soft revenues in Barnett Shale affected the results. This downtrend is likely to have continued in the third quarter as well. Precisely, the Zacks Consensus Estimate for the unit’s third-quarter adjusted EBITDA is pegged at $245 million, implying a 21.7% decline from the year-ago quarter’s reported number of $313 million.
What Does Our Model Say?
Our proven Zacks model does not conclusively predict an earnings beat for Williams this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Williams has an Earnings ESP of -14.36%.
In the last reported quarter, this Tulsa, OK-based energy player’s adjusted earnings per share of 25 cents beat the Zacks Consensus Estimate of 23 cents, attributable to a strong contribution from the Northeast G&P unit. However, the bottom line marginally missed the year-earlier quarter's adjusted earnings of 26 cents due to weak contribution from the Transmission & Gulf of Mexico and West segments.
The energy infrastructure provider’s quarterly revenues of $1.78 billion also lagged the Zacks Consensus Estimate by 4.23% and decreased from the year-ago figure of $2.04 billion as well.
As far as earnings surprises are concerned, this midstream player shows a pleasant record with its bottom line topping the Zacks Consensus Estimate thrice in the last four quarterly reports, lagging the same just once. The average surprise is 4.26%. This is depicted in the graph below:
Williams Companies, Inc. The Price and EPS Surprise
While earnings outperformance looks uncertain for Williams, here are some firms worth considering from the energy space, which according to our model have the perfect combination of ingredients to deliver a positive surprise this reporting cycle:
Marathon Oil Corporation (MRO - Free Report) has an Earnings ESP of +1.50% and is Zacks #3 Ranked at present. The company is scheduled to release earnings on Nov 4.
NuStar Energy L.P. (NS - Free Report) has an Earnings ESP of +2.94% and a Zacks Rank #2, presently. The firm is scheduled to release earnings on Nov 5.
Targa Resources, Inc. (TRGP - Free Report) has an Earnings ESP of +33.33% and a Zacks Rank of 3, currently. The company is scheduled to release earnings on Nov 5.
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Image: Bigstock
How is Williams Companies (WMB) Placed Ahead of Q3 Earnings?
The Williams Companies, Inc. (WMB - Free Report) is set to release third-quarter 2020 results on Monday Nov 2, after the closing bell.
The Zacks Consensus Estimate for the to-be-reported quarter’s profit is 27 cents per share and for revenues is $1.77 billion.
Against this backdrop, let’s consider the factors that are likely to impact the company’s September-quarter results.
Factors to Consider for Q3 Results
Williams’ Northeast G&P segment, which engages in natural gas gathering and processing along with the NGL fractionation business in Marcellus and Utica shale regions, is likely to have performed well in the third quarter, a trend that most likely continued sequentially. The Zacks Consensus Estimate for the unit’s third-quarter adjusted EBITDA is pegged at $363 million, indicating a 5.8% rise from the year-ago quarter’s reported figure of $343 million.
However, the company’s Westunitconsisting of Northwest pipeline and operations in various regions, such as Colorado, Mid-Continent and Haynesville Shale among others generated adjusted EBITDA of $252 million in the second quarter, down 12.2% from $287 million in the year-ago quarter. Soft revenues in Barnett Shale affected the results. This downtrend is likely to have continued in the third quarter as well. Precisely, the Zacks Consensus Estimate for the unit’s third-quarter adjusted EBITDA is pegged at $245 million, implying a 21.7% decline from the year-ago quarter’s reported number of $313 million.
What Does Our Model Say?
Our proven Zacks model does not conclusively predict an earnings beat for Williams this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Williams has an Earnings ESP of -14.36%.
Zacks Rank: Williams carries a Zacks Rank #3, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Highlights of Q2 Earnings & Surprise History
In the last reported quarter, this Tulsa, OK-based energy player’s adjusted earnings per share of 25 cents beat the Zacks Consensus Estimate of 23 cents, attributable to a strong contribution from the Northeast G&P unit. However, the bottom line marginally missed the year-earlier quarter's adjusted earnings of 26 cents due to weak contribution from the Transmission & Gulf of Mexico and West segments.
The energy infrastructure provider’s quarterly revenues of $1.78 billion also lagged the Zacks Consensus Estimate by 4.23% and decreased from the year-ago figure of $2.04 billion as well.
As far as earnings surprises are concerned, this midstream player shows a pleasant record with its bottom line topping the Zacks Consensus Estimate thrice in the last four quarterly reports, lagging the same just once. The average surprise is 4.26%. This is depicted in the graph below:
Williams Companies, Inc. The Price and EPS Surprise
Williams Companies, Inc. The price-eps-surprise | Williams Companies, Inc. The Quote
Stocks to Consider
While earnings outperformance looks uncertain for Williams, here are some firms worth considering from the energy space, which according to our model have the perfect combination of ingredients to deliver a positive surprise this reporting cycle:
Marathon Oil Corporation (MRO - Free Report) has an Earnings ESP of +1.50% and is Zacks #3 Ranked at present. The company is scheduled to release earnings on Nov 4.
NuStar Energy L.P. (NS - Free Report) has an Earnings ESP of +2.94% and a Zacks Rank #2, presently. The firm is scheduled to release earnings on Nov 5.
Targa Resources, Inc. (TRGP - Free Report) has an Earnings ESP of +33.33% and a Zacks Rank of 3, currently. The company is scheduled to release earnings on Nov 5.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot stocks we're targeting >>