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Murphy USA (MUSA) Headed for Strong Q4 Earnings: Know Why
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Murphy USA (MUSA - Free Report) is set to release fourth-quarter results on Feb 1. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $4.03 per share on revenues of $5.6 billion.
Let’s delve into the factors that might have influenced the downstream operator’s results in the December quarter. But it’s worth taking a look at MUSA’s previous-quarter performance first.
Highlights of Q3 Earnings & Surprise History
In the last reported quarter, the El Dorado, AR-based motor fuel retailer beat the consensus mark due to a rise in the retail gasoline price and a higher retail margin. MUSA had reported earnings per share of $9.28, well above the Zacks Consensus Estimate of $7.82. Moreover, revenues of $6.2 billion generated by the firm went past the Zacks Consensus Estimate of $6 billion primarily on the back of improved merchandise sales.
MUSA beat the Zacks Consensus Estimate in each of the last four quarters, which resulted in an earnings surprise of 51%, on average. This is depicted in the graph below:
The Zacks Consensus Estimate for the fourth-quarter bottom line has been revised 9.8% upward in the past seven days. The estimated figure indicates a 4.7% deterioration year over year. However, the Zacks Consensus Estimate for revenues suggests a 16.5% increase from the year-ago period.
Factors to Consider
In the third quarter of 2022, the company’s retail gallons rose 13.2% from the year-ago period to 1,245.6 million. The positive momentum is most likely to have continued in the fourth quarter, thanks to a marked improvement in fuel consumption on the back of strong travel demand.
Consequently, the Zacks Consensus Estimate for Murphy USA’s retail fuel volumes in the October-December period is pegged at 1,202 million gallons, up from the prior-year quarter’s level of 1,120 million gallons. This is likely to have buoyed the results of MUSA.
Murphy USA is also expected to have benefited from a better margin environment. The company’s third-quarter fuel margins widened to 39.30 cents per gallon from 24 cents in the corresponding period of 2021. With pushed-up crude differentials, the favorable margin story is likely to have continued in the to-be-reported quarter. As a reflection of this, the consensus mark for fourth-quarter retail fuel margin stands at 35.97 cents per gallon, suggesting a rise of 41.1% from the year-ago period.
Why a Likely Positive Surprise?
Our proven model predicts an earnings beat for Murphy USA this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases 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.
Murphy USA has an Earnings ESP of +35.37% and a Zacks Rank #1.
Murphy USA is not the only energy company looking up this earnings cycle. Here are some other firms from the space that you may want to consider on the basis of our model:
Patterson-UTI Energy (PTEN - Free Report) has an Earnings ESP of +5.53% and a Zacks Rank #1. The firm is scheduled to release earnings on Feb 8.
Patterson-UTI Energy topped the Zacks Consensus Estimate by an average of 169.2% in the trailing four quarters, including a 47.4% beat in the last reported quarter. Valued at around $3.5 billion, PTEN has gained 57.4% in a year.
Exxon Mobil Corporation (XOM - Free Report) has an Earnings ESP of +5.09% and a Zacks Rank #3. The firm is scheduled to release earnings on Jan 31.
ExxonMobil beat the Zacks Consensus Estimate for earnings in three of the last four quarters. It has a trailing four-quarter earnings surprise of 5.1%, on average. Valued at around $464.4 billion, XOM has gained 51.9% in a year.
Enterprise Products Partners L.P. (EPD - Free Report) has an Earnings ESP of +3.07% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 1.
For 2022, Enterprise Products Partners has a projected earnings growth rate of 18.1%. Valued at around $56.8 billion, EPD has gained 8.8% in a year.
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Murphy USA (MUSA) Headed for Strong Q4 Earnings: Know Why
Murphy USA (MUSA - Free Report) is set to release fourth-quarter results on Feb 1. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $4.03 per share on revenues of $5.6 billion.
Let’s delve into the factors that might have influenced the downstream operator’s results in the December quarter. But it’s worth taking a look at MUSA’s previous-quarter performance first.
Highlights of Q3 Earnings & Surprise History
In the last reported quarter, the El Dorado, AR-based motor fuel retailer beat the consensus mark due to a rise in the retail gasoline price and a higher retail margin. MUSA had reported earnings per share of $9.28, well above the Zacks Consensus Estimate of $7.82. Moreover, revenues of $6.2 billion generated by the firm went past the Zacks Consensus Estimate of $6 billion primarily on the back of improved merchandise sales.
MUSA beat the Zacks Consensus Estimate in each of the last four quarters, which resulted in an earnings surprise of 51%, on average. This is depicted in the graph below:
Murphy USA Inc. Price and EPS Surprise
Murphy USA Inc. price-eps-surprise | Murphy USA Inc. Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for the fourth-quarter bottom line has been revised 9.8% upward in the past seven days. The estimated figure indicates a 4.7% deterioration year over year. However, the Zacks Consensus Estimate for revenues suggests a 16.5% increase from the year-ago period.
Factors to Consider
In the third quarter of 2022, the company’s retail gallons rose 13.2% from the year-ago period to 1,245.6 million. The positive momentum is most likely to have continued in the fourth quarter, thanks to a marked improvement in fuel consumption on the back of strong travel demand.
Consequently, the Zacks Consensus Estimate for Murphy USA’s retail fuel volumes in the October-December period is pegged at 1,202 million gallons, up from the prior-year quarter’s level of 1,120 million gallons. This is likely to have buoyed the results of MUSA.
Murphy USA is also expected to have benefited from a better margin environment. The company’s third-quarter fuel margins widened to 39.30 cents per gallon from 24 cents in the corresponding period of 2021. With pushed-up crude differentials, the favorable margin story is likely to have continued in the to-be-reported quarter. As a reflection of this, the consensus mark for fourth-quarter retail fuel margin stands at 35.97 cents per gallon, suggesting a rise of 41.1% from the year-ago period.
Why a Likely Positive Surprise?
Our proven model predicts an earnings beat for Murphy USA this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases 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.
Murphy USA has an Earnings ESP of +35.37% and a Zacks Rank #1.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Murphy USA is not the only energy company looking up this earnings cycle. Here are some other firms from the space that you may want to consider on the basis of our model:
Patterson-UTI Energy (PTEN - Free Report) has an Earnings ESP of +5.53% and a Zacks Rank #1. The firm is scheduled to release earnings on Feb 8.
Patterson-UTI Energy topped the Zacks Consensus Estimate by an average of 169.2% in the trailing four quarters, including a 47.4% beat in the last reported quarter. Valued at around $3.5 billion, PTEN has gained 57.4% in a year.
Exxon Mobil Corporation (XOM - Free Report) has an Earnings ESP of +5.09% and a Zacks Rank #3. The firm is scheduled to release earnings on Jan 31.
ExxonMobil beat the Zacks Consensus Estimate for earnings in three of the last four quarters. It has a trailing four-quarter earnings surprise of 5.1%, on average. Valued at around $464.4 billion, XOM has gained 51.9% in a year.
Enterprise Products Partners L.P. (EPD - Free Report) has an Earnings ESP of +3.07% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 1.
For 2022, Enterprise Products Partners has a projected earnings growth rate of 18.1%. Valued at around $56.8 billion, EPD has gained 8.8% in a year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.