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Can VAALCO (EGY) Deliver Strong Q4 Earnings Performance?
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VAALCO Energy, Inc. (EGY - Free Report) is set to release fourth-quarter results on Mar 13. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 15 cents per unit on revenues of $130.5 million.
Let’s delve into the factors that might have influenced the West Africa-focused oil and gas finder’s results in the December quarter. But it’s worth taking a look at EGY’s previous-quarter performance first.
Highlights of Q3 Earnings & Surprise History
In the last reported quarter, the Houston, TX-based international upstream operator missed the consensus mark on lower commodity price realizations. EGY had reported adjusted earnings per share of 7 cents, below the Zacks Consensus Estimate of 14 cents. Revenues of $116.3 million generated by the firm also underperformed the Zacks Consensus Estimate by 7.8%.
VAALCO Energy missed the Zacks Consensus Estimate for earnings in each of the last three quarters, resulting in a negative earnings surprise of 48%, on average. This is depicted in the graph below:
The Zacks Consensus Estimate for the fourth-quarter bottom line has been revised 25% downward in the past seven days. The estimated figure indicates a 21.1% fall year over year. Meanwhile, the Zacks Consensus Estimate for revenues suggests a 35.1% increase from the year-ago period.
Factors to Consider
VAALCO Energy is expected to have reaped the reward of higher production during the fourth quarter. In the third quarter, the company’s output averaged 24,430 barrels of oil equivalent per day, more than doubling from a year ago. The uptick is most likely to have continued in the to-be-reported quarter, thanks to EGY’s impressive production profile from its assets in the Gabon offshore Etame license and impressive operational performance in Egypt.
But on a somewhat bearish note, a dip in commodity realizations might have dampened the positives associated with production gains. In the third quarter of 2023, the company’s average realized unit price for oil fell 39% from the year-earlier period to $63.41 per barrel. We expect this decline to have continued in the fourth quarter, with benchmark prices down year over year.
Moreover, the increase in VAALCO costs might have dented the company’s to-be-reported bottom line. EGY’s total operating cost in the third quarter surged around 83% year over year to $80.7 million. The upward cost trajectory is likely to have continued in the fourth quarter due to inflationary and industry supply pressures.
What Does Our Model Say?
The proven Zacks model does not conclusively show that VAALCO Energy is likely to beat estimates in the fourth quarter. 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: VAALCO Energy has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 15 cents per share each.
Zacks Rank: EGY currently carries a Zacks Rank #5 (Strong Sell).
Stocks to Consider
While an earnings beat looks uncertain for VAALCO Energy, here are some firms that you may want to consider on the basis of our model:
Ocular Therapeutix, Inc. (OCUL - Free Report) has an Earnings ESP of +22.54% and a Zacks Rank #2. The firm is scheduled to release earnings on Mar 11.
The Zacks Consensus Estimate for Ocular Therapeutix’s 2024 earnings per share indicates 10% year-over-year growth. Valued at around $860.1 million, OCUL has gained 84.4% in a year.
Dollar Tree, Inc. (DLTR - Free Report) has an Earnings ESP of +0.53% and a Zacks Rank #3. The firm is scheduled to release earnings on Mar 13.
The Zacks Consensus Estimate for Dollar Tree’s fiscal 2025 earnings indicates 17.3% year-over-year growth. Valued at around $32.5 billion, DLTR has gained 5.8% in a year.
OPAL Fuels Inc. (OPAL - Free Report) has an Earnings ESP of +27.27% and a Zacks Rank #3. The firm is scheduled to release earnings on Mar 13.
Over the past 60 days, the Zacks Consensus Estimate for OPAL Fuels’ 2024 earnings has moved up 22.9%. Valued at around $813.6 million, OPAL has lost 34.5% in a year.
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Can VAALCO (EGY) Deliver Strong Q4 Earnings Performance?
VAALCO Energy, Inc. (EGY - Free Report) is set to release fourth-quarter results on Mar 13. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 15 cents per unit on revenues of $130.5 million.
Let’s delve into the factors that might have influenced the West Africa-focused oil and gas finder’s results in the December quarter. But it’s worth taking a look at EGY’s previous-quarter performance first.
Highlights of Q3 Earnings & Surprise History
In the last reported quarter, the Houston, TX-based international upstream operator missed the consensus mark on lower commodity price realizations. EGY had reported adjusted earnings per share of 7 cents, below the Zacks Consensus Estimate of 14 cents. Revenues of $116.3 million generated by the firm also underperformed the Zacks Consensus Estimate by 7.8%.
VAALCO Energy missed the Zacks Consensus Estimate for earnings in each of the last three quarters, resulting in a negative earnings surprise of 48%, on average. This is depicted in the graph below:
Vaalco Energy Inc Price and EPS Surprise
Vaalco Energy Inc price-eps-surprise | Vaalco Energy Inc Quote
Trend in Estimate Revisions
The Zacks Consensus Estimate for the fourth-quarter bottom line has been revised 25% downward in the past seven days. The estimated figure indicates a 21.1% fall year over year. Meanwhile, the Zacks Consensus Estimate for revenues suggests a 35.1% increase from the year-ago period.
Factors to Consider
VAALCO Energy is expected to have reaped the reward of higher production during the fourth quarter. In the third quarter, the company’s output averaged 24,430 barrels of oil equivalent per day, more than doubling from a year ago. The uptick is most likely to have continued in the to-be-reported quarter, thanks to EGY’s impressive production profile from its assets in the Gabon offshore Etame license and impressive operational performance in Egypt.
But on a somewhat bearish note, a dip in commodity realizations might have dampened the positives associated with production gains. In the third quarter of 2023, the company’s average realized unit price for oil fell 39% from the year-earlier period to $63.41 per barrel. We expect this decline to have continued in the fourth quarter, with benchmark prices down year over year.
Moreover, the increase in VAALCO costs might have dented the company’s to-be-reported bottom line. EGY’s total operating cost in the third quarter surged around 83% year over year to $80.7 million. The upward cost trajectory is likely to have continued in the fourth quarter due to inflationary and industry supply pressures.
What Does Our Model Say?
The proven Zacks model does not conclusively show that VAALCO Energy is likely to beat estimates in the fourth quarter. 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: VAALCO Energy has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 15 cents per share each.
Zacks Rank: EGY currently carries a Zacks Rank #5 (Strong Sell).
Stocks to Consider
While an earnings beat looks uncertain for VAALCO Energy, here are some firms that you may want to consider on the basis of our model:
Ocular Therapeutix, Inc. (OCUL - Free Report) has an Earnings ESP of +22.54% and a Zacks Rank #2. The firm is scheduled to release earnings on Mar 11.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Ocular Therapeutix’s 2024 earnings per share indicates 10% year-over-year growth. Valued at around $860.1 million, OCUL has gained 84.4% in a year.
Dollar Tree, Inc. (DLTR - Free Report) has an Earnings ESP of +0.53% and a Zacks Rank #3. The firm is scheduled to release earnings on Mar 13.
The Zacks Consensus Estimate for Dollar Tree’s fiscal 2025 earnings indicates 17.3% year-over-year growth. Valued at around $32.5 billion, DLTR has gained 5.8% in a year.
OPAL Fuels Inc. (OPAL - Free Report) has an Earnings ESP of +27.27% and a Zacks Rank #3. The firm is scheduled to release earnings on Mar 13.
Over the past 60 days, the Zacks Consensus Estimate for OPAL Fuels’ 2024 earnings has moved up 22.9%. Valued at around $813.6 million, OPAL has lost 34.5% in a year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.