Back to top

Image: Bigstock

Why Western Midstream (WES) Outpaced the Stock Market Today

Read MoreHide Full Article

The most recent trading session ended with Western Midstream (WES - Free Report) standing at $38.86, reflecting a +1.46% shift from the previouse trading day's closing. This change outpaced the S&P 500's 0.75% gain on the day. Elsewhere, the Dow saw an upswing of 0.58%, while the tech-heavy Nasdaq appreciated by 1%.

The oil and gas transportation and storage company's shares have seen an increase of 1.43% over the last month, surpassing the Oils-Energy sector's loss of 4.12% and falling behind the S&P 500's gain of 4.03%.

Investors will be eagerly watching for the performance of Western Midstream in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $0.85, reflecting a 21.43% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $916.7 million, indicating a 18.13% increase compared to the same quarter of the previous year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $4.16 per share and a revenue of $3.64 billion, indicating changes of +60% and +17.06%, respectively, from the former year.

Investors might also notice recent changes to analyst estimates for Western Midstream. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 2.51% rise in the Zacks Consensus EPS estimate. Western Midstream is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, Western Midstream is currently trading at a Forward P/E ratio of 9.22. This valuation marks a discount compared to its industry's average Forward P/E of 18.31.

Meanwhile, WES's PEG ratio is currently 0.72. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. By the end of yesterday's trading, the Oil and Gas - Refining and Marketing - Master Limited Partnerships industry had an average PEG ratio of 0.94.

The Oil and Gas - Refining and Marketing - Master Limited Partnerships industry is part of the Oils-Energy sector. At present, this industry carries a Zacks Industry Rank of 162, placing it within the bottom 36% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow WES in the coming trading sessions, be sure to utilize Zacks.com.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Western Midstream Partners, LP (WES) - free report >>

Published in