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Factors to Take Into Account Ahead of BP's Q2 Earnings Release
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BP plc (BP - Free Report) is set to report second-quarter 2023 results on Aug 1, before the opening bell.
In the last reported quarter, the leading integrated energy company’s adjusted earnings of $1.66 per American Depositary Share on a replacement-cost basis (excluding non-operating items) beat the Zacks Consensus Estimate of earnings of $1.33 per share. The improvement in quarterly earnings resulted from an increase in oil-equivalent production volumes. The positives were partially offset by lower realizations of commodity prices and a decline in refinery throughputs.
In the trailing four quarters, BP beat the Zacks Consensus Estimate for earnings thrice and missed the same once, the average earnings surprise being 18.3%. This is depicted in the graph below:
Let’s see how things have shaped up prior to this announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for BP’s second-quarter earnings per share of $1.17 has witnessed no upward movement and three downward revisions over the past 30 days. The estimated figure suggests a decline of 55.2% from the prior-year reported number.
The Zacks Consensus Estimate for second-quarter revenues of $62.2 billion indicates a 10.5% decline from the year-ago reported figure.
Factors to Note
Per the U.S. Energy Information Administration data, the average West Texas Intermediate crude prices in April, May and June were $79.45, $71.58 and $70.25 per barrel, respectively. Notably, in the year-ago April, May and June, average oil prices were $101.78 per barrel, $109.55 per barrel and $114.84 per barrel, respectively.
Worries over a recession and economic slowdown possibly hurt the oil price in the June-end quarter. Natural gas prices saw large declines and were exceptionally volatile in the second quarter, depicting that the upstream business was unfavorable in the quarter.
The Zacks Consensus Estimate for BP’s sales and other operating revenues is pegged at $58,572 million, suggesting a decline from the $67,866 million reported in the year-ago quarter. Our estimate for the same is pinned at $58,571.8 million, indicating a massive year-over-year decline.
The Zacks Consensus Estimate for BP’s replacement cost profit before interest and tax from oil production and operations is pegged at $1,946 million, suggesting a decline from the $5,902 million reported in the year-ago quarter. Our estimate for the same is expected to decline 45% year over year.
Hence, lower commodity prices are likely to have affected BP’s performance in the to-be-reported quarter.
Earnings Whispers
Our proven model does not predict an earnings beat for BP 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. That is not the case here, as you will see below.
Earnings ESP: The company’s Earnings ESP is 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $1.17 per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: BP currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
While an earnings beat looks uncertain for BP, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
The company is scheduled to release second-quarter earnings on Aug 2. The Zacks Consensus Estimate for MUSA’s earnings is pegged at $6.03 per share, suggesting a decline from the prior-year reported figure.
Cactus, Inc. (WHD - Free Report) has an Earnings ESP of +3.97% and a Zacks #3 at present.
Cactus is scheduled to release second-quarter results on Aug 7. The Zacks Consensus Estimate for WHD’s earnings is pegged at 69 cents per share, indicating an improvement from the year-ago quarter’s reported figure.
Southwestern Energy Company (SWN - Free Report) has an Earnings ESP of +4.21% and is a Zacks #3 Ranked player at present.
Southwestern is scheduled to release second-quarter results on Aug 3. The Zacks Consensus Estimate for SWN’s earnings is pegged at 7 cents per share, suggesting a decline from the prior-year reported figure.
Image: Bigstock
Factors to Take Into Account Ahead of BP's Q2 Earnings Release
BP plc (BP - Free Report) is set to report second-quarter 2023 results on Aug 1, before the opening bell.
In the last reported quarter, the leading integrated energy company’s adjusted earnings of $1.66 per American Depositary Share on a replacement-cost basis (excluding non-operating items) beat the Zacks Consensus Estimate of earnings of $1.33 per share. The improvement in quarterly earnings resulted from an increase in oil-equivalent production volumes. The positives were partially offset by lower realizations of commodity prices and a decline in refinery throughputs.
In the trailing four quarters, BP beat the Zacks Consensus Estimate for earnings thrice and missed the same once, the average earnings surprise being 18.3%. This is depicted in the graph below:
BP p.l.c. Price and EPS Surprise
BP p.l.c. price-eps-surprise | BP p.l.c. Quote
Let’s see how things have shaped up prior to this announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for BP’s second-quarter earnings per share of $1.17 has witnessed no upward movement and three downward revisions over the past 30 days. The estimated figure suggests a decline of 55.2% from the prior-year reported number.
The Zacks Consensus Estimate for second-quarter revenues of $62.2 billion indicates a 10.5% decline from the year-ago reported figure.
Factors to Note
Per the U.S. Energy Information Administration data, the average West Texas Intermediate crude prices in April, May and June were $79.45, $71.58 and $70.25 per barrel, respectively. Notably, in the year-ago April, May and June, average oil prices were $101.78 per barrel, $109.55 per barrel and $114.84 per barrel, respectively.
Worries over a recession and economic slowdown possibly hurt the oil price in the June-end quarter. Natural gas prices saw large declines and were exceptionally volatile in the second quarter, depicting that the upstream business was unfavorable in the quarter.
The Zacks Consensus Estimate for BP’s sales and other operating revenues is pegged at $58,572 million, suggesting a decline from the $67,866 million reported in the year-ago quarter. Our estimate for the same is pinned at $58,571.8 million, indicating a massive year-over-year decline.
The Zacks Consensus Estimate for BP’s replacement cost profit before interest and tax from oil production and operations is pegged at $1,946 million, suggesting a decline from the $5,902 million reported in the year-ago quarter. Our estimate for the same is expected to decline 45% year over year.
Hence, lower commodity prices are likely to have affected BP’s performance in the to-be-reported quarter.
Earnings Whispers
Our proven model does not predict an earnings beat for BP 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. That is not the case here, as you will see below.
Earnings ESP: The company’s Earnings ESP is 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $1.17 per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: BP currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
While an earnings beat looks uncertain for BP, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Murphy USA Inc. (MUSA - Free Report) has an Earnings ESP of +1.80% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is scheduled to release second-quarter earnings on Aug 2. The Zacks Consensus Estimate for MUSA’s earnings is pegged at $6.03 per share, suggesting a decline from the prior-year reported figure.
Cactus, Inc. (WHD - Free Report) has an Earnings ESP of +3.97% and a Zacks #3 at present.
Cactus is scheduled to release second-quarter results on Aug 7. The Zacks Consensus Estimate for WHD’s earnings is pegged at 69 cents per share, indicating an improvement from the year-ago quarter’s reported figure.
Southwestern Energy Company (SWN - Free Report) has an Earnings ESP of +4.21% and is a Zacks #3 Ranked player at present.
Southwestern is scheduled to release second-quarter results on Aug 3. The Zacks Consensus Estimate for SWN’s earnings is pegged at 7 cents per share, suggesting a decline from the prior-year reported figure.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.