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Why We Expect EQT Corp. (EQT) to Deliver Q2 Earnings Beat

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EQT Corporation (EQT - Free Report) is set to beat earnings estimates when it reports second-quarter 2021 results on Jul 28, after the closing bell.  

In the last reported quarter, the upstream company announced adjusted earnings of 30 cents per share, which beat the Zacks Consensus Estimate of 27 cents due to increased gas equivalent production volumes and higher realized commodity price realizations. The positives were partially offset by higher processing expenses.

In the trailing four quarters, EQT Corp.’s earnings beat the Zacks Consensus Estimate thrice and missed the same on another occasion, with the average surprise being 42%. This is depicted in the graph below:

EQT Corporation Price and EPS Surprise

EQT Corporation Price and EPS Surprise

EQT Corporation price-eps-surprise | EQT Corporation Quote

Let’s see how things have shaped up prior to this announcement.

Trend in Estimate Revision

The Zacks Consensus Estimate for second-quarter earnings per share of 4 cents has witnessed six upward and three downward revisions over the past 30 days. The estimated figure suggests an increase of 122.2% from the prior-year reported number.

Similarly, the consensus estimate for second-quarter revenues of $1 billion indicates a 23.2% increase from the year-ago reported figure.

What the Quantitative Model Suggests

Our proven model predicts an earnings beat for EQT Corp. 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 an earnings beat.

Earnings ESP: Earnings ESP for the company is currently +29.63%. This is because the Most Accurate Estimate is pegged at 5 cents per share, higher than the Zacks Consensus Estimate of 4 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.  

Zacks Rank: EQT Corp. currently holds a Zacks Rank #3.

Factors Driving the Better-Than-Expected Earnings

As EQT Corp. is among the leading natural gas producers in the United States, the favorable price of the commodity is primarily expected to have positively impacted the bottom line in the second quarter. The Zacks Consensus Estimate for second-quarter natural gas price is pegged at $2.99 per thousand cubic feet (Mcf), signaling a rise from the year-ago level of $1.80.

The consensus estimate for the company’s second-quarter production is pegged at 4,578 million cubic feet of natural gas equivalent per day (Mmcfe/d), indicating an increase from the year-ago level of 3,798 Mmcfe/d.

The consensus estimate for crude oil sales volumes for the quarter is pegged at 300 thousand barrels (MBbls), signaling a rise from 176 MBbls a year ago. Also, average crude oil sales price estimate is pegged at $52 per barrel, indicating a massive jump from $10.17 in the year-ago quarter.

The effects of significant improvement in natural gas and oil prices along with increased production volumes are expected to have boosted the company’s bottom line in the second quarter.

Other Stocks to Consider

Here are some other companies from the Energy space that you may also want to consider, as our model shows that these too have the right combination of elements to post an earnings beat in the upcoming quarterly reports:

EOG Resources, Inc. (EOG - Free Report) has an Earnings ESP of +6.47% and a Zacks Rank of 1. It is scheduled to report second-quarter results on Aug 4. You can see the complete list of today’s Zacks #1 Rank stocks here.

ConocoPhillips (COP - Free Report) has an Earnings ESP of +4.34% and is a Zacks #1 Ranked player. The company is scheduled to release second-quarter results on Aug 3.

Continental Resources, Inc. (CLR - Free Report) has an Earnings ESP of +12.68% and a Zacks Rank #1. The firm is scheduled to release quarterly earnings on Aug 2.