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Why EOG Resources (EOG) is Likely to Deliver Q2 Earnings Beat

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EOG Resources, Inc. (EOG - Free Report) is set to beat earnings estimates when it reports second-quarter 2021 results on Aug 4, after the closing bell.  

In the last reported quarter, the company reported adjusted earnings per share of $1.62, beating the Zacks Consensus Estimate of $1.44 due to increased crude oil and condensates price along with a decline in lease and well expenses, partially offset by lower oil equivalent production volumes.

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

Trend in Estimate Revision

The Zacks Consensus Estimate for the company’s second-quarter earnings per share of $1.54 has witnessed 10 upward estimate revisions and no downward movement in the past 30 days. This estimate is indicative of an improvement from the year-ago reported loss of 23 cents per share.

The Zacks Consensus Estimate for its second-quarter revenues is pegged at $4.1 billion, suggesting an increase of 266.6% from the year-ago reported figure.

EOG Resources beat estimates thrice in the last four quarters and missed once, delivering an average earnings surprise of 51%, as shown in the chart below.

EOG Resources, Inc. Price and EPS Surprise

EOG Resources, Inc. Price and EPS Surprise

EOG Resources, Inc. price-eps-surprise | EOG Resources, Inc. Quote

What the Quantitative Model Suggests

Our proven model predicts an earnings beat for EOG Resources 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 +0.50%. This is because the Most Accurate Estimate is pegged at $1.55 per share, higher than the Zacks Consensus Estimate of $1.54. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.  

Zacks Rank: EOG Resources currently sports a Zacks Rank #1.

Factors Driving the Better-Than-Expected Earnings

EOG Resources’ focus on exploration and production of oil and gas resources in the Permian, Bakken and Eagle Ford is expected to reflect on second-quarter results. The Zacks Consensus Estimate for average daily production volumes is pegged at 813 thousand barrels of oil equivalent per day (MBoe/d), indicating a significant increase from the year ago period’s 623.4 MBoe/d. The consensus estimate for crude oil and condensate volumes is pegged at 446 thousand barrels per day (MBbls/d), signaling a rise from the year-ago period’s 331.1 MBbls/d.

The Zacks Consensus Estimate for average crude oil and condensates price is pegged at $63 per barrel, which indicates a significant increase from the year-ago period’s $20.40. The same for second-quarter average natural gas liquids price is pegged at $25.68 per barrel, signaling an increase from the year-ago figure of $10.20. Also, the consensus estimate for average natural gas price is $2.71 per thousand cubic feet, indicating an increase from $1.36 in the year-ago quarter.

The increase in hydrocarbon production volumes and rising commodity prices are expected to have boosted EOG Resources’ second-quarter bottom line and positioned it for an earnings beat.

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:

Berry Corporation (BRY - Free Report) has an Earnings ESP of +12.73% and a Zacks Rank of 1. It is scheduled to report second-quarter results on Aug 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

DCP Midstream, LP has an Earnings ESP of +4.55% and is a Zacks #2 Ranked player. The company is scheduled to release second-quarter results on Aug 4.

Cimarex Energy Co. has an Earnings ESP of +0.66% and a Zacks Rank #3. The firm is scheduled to release quarterly earnings on Aug 5.


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