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What's in the Offing for Liberty Energy Stock in Q3 Earnings?

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Liberty Energy Inc. (LBRT - Free Report) is set to release third-quarter results on Oct. 16. The Zacks Consensus Estimate for earnings is pegged at 59 cents per share on revenues of $1.16 billion.
 

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Let’s delve into the factors that might have influenced LBRT’s performance in the to-be-reported quarter. Before that, it’s worth taking a look at the company’s performance in the last reported quarter.
 

Highlights of Q2 Earnings

In the previous reported quarter, the Denver, CO-based oilfield service company’s adjusted net income beat the consensus mark. LBRT reported adjusted net income per share of 61 cents, one cent higher than the Zacks Consensus Estimate, driven by strong execution and enhanced fleet utilization. However, revenues of $1.16 billion missed the Zacks Consensus Estimate by 1.28%.

LBRT’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and missed the mark in the other two, delivering an average surprise of 0.04%. 

This is depicted in the graph below:

Liberty Energy Inc. Price and EPS Surprise

Liberty Energy Inc. Price and EPS Surprise

Liberty Energy Inc. price-eps-surprise | Liberty Energy Inc. Quote
 

Trend in LBRT’s Estimate Revision

The Zacks Consensus Estimate for third-quarter 2024 earnings of 59 cents per share has witnessed no upward revision and one downward movement in the past seven days. The estimated figure indicates a 4.69% year-over-year bottom-line decline. The Zacks Consensus Estimate for revenues indicates a deterioration of 30.59% from the year-ago period’s level.
 

Factors to Consider

LBRT's revenues are likely to have been hurt in the quarter to be reported. The company's top line is primarily driven by the demand for hydraulic fracturing services, influenced by factors such as oil and gas prices, well productivity and competition within the industry. Our model predicts third-quarter revenues to decrease to $1.15 billion from the last reported quarter’s level of $1.16 billion.  This can be attributed to a weak global macroeconomic environment and growing conflicts in the Middle East.

On a positive note, the deterioration in LBRT's costs is expected to have positively improved its bottom-line performance. The company’s costs and expenses are projected to have reached $1.01 billion in the third quarter, slightly down from last quarter’s level of $1.02 million. Additionally, Depreciation, Depletion and Amortization expenses are anticipated to drop from $123.3 million to $114.9 million. Similarly, General and Administrative expenses are expected to decrease from $57.7 million to $55.7 million.
 

What Does Our Model Say?

Our proven Zacks model does not conclusively predict an earnings beat for Liberty Energy 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. However, that’s not the case here.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, for this company is -5.25%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: LBRT currently carries a Zacks Rank #3.
 

Stocks to Consider

Here are some firms from the energy space that you may want to consider, as these have the right combination of elements to post an earnings beat this reporting cycle.

Cheniere Energy, Inc. (LNG - Free Report) has an Earnings ESP of +2.27% and a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The firm is scheduled to release earnings on Oct. 31. LNG’s earnings beat the Zacks Consensus Estimate in two of the last four quarters and missed the other two, delivering an average surprise of 55.86%. Valued at around $43.18 billion, LNG has gained 9.7% in a year.

Chevron Corporation (CVX - Free Report) has an Earnings ESP of +3.36% and a Zacks Rank #3 at present. The firm is scheduled to release earnings on Nov. 1.

Valued at around $276.93 billion, Chevron, through its subsidiaries, engages in integrated energy and chemicals operations in the United States and internationally. The company operates under two segments, Upstream and Downstream.

APA Corporation (APA - Free Report) has an Earnings ESP of +1.58% and a Zacks Rank #3 at present. The firm is scheduled to release earnings on Nov. 7.

APA’s earnings beat the Zacks Consensus Estimate in two of the last four quarters and missed in the other two, delivering an average surprise of 4.08%. APA Corporation, an independent energy company, explores, develops and produces natural gas, crude oil and natural gas liquids.

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