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Cheniere Energy Partners (CQH): Q3 Earnings to Surprise?
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Cheniere Energy Partners LP Holdings LLC is expected to report third-quarter 2016 results before the opening bell on Thursday, Nov 3.
In each of the last four quarters, the partnership delivered an earnings surprise of 0.00%.
Let’s see how things are shaping up for this announcement.
Factors to Consider This Quarter
Cheniere Energy Partners LP Holdings, by virtue of its 55.9% ownership in Cheniere Energy Partners LP (CQP - Free Report) , primarily operates the Sabine Pass natural gas regasification and liquefaction facilities. Cheniere Energy Partners LP Holdings also operates Creole Trail Pipeline located in Louisiana. This solid asset base might help the partnership to earn sufficiently for its shareholders.
Moreover, the fate of the midstream player’s business is positively correlated with natural gas production. The output of the commodity in the U.S. has been booming owing to hydraulic fracturing (or fracking) and sophisticated horizontal drilling techniques. In fact, it has been an oversupplied market for the commodity over the past few quarters. The same is applicable for the third quarter.
Hence, we can say that the business environment was favorable for the partnership as higher production of natural gas usually increases the need for regasification, liquefaction and transportation activities. Yet, we have to wait for the final earnings release to find out whether this increase in output translates into a positive surprise.
Our proven model does not conclusively show that Cheniere Energy Partners LP Holdings will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat consensus estimates. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
That is not the case here, as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 2 cents, resulting in an Earnings ESP of 0.00%.
Zacks Rank: Cheniere Energy Partners LP has a Zacks Rank #3. Though a Zacks Rank #3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult.
We caution against Sell-rated stocks (Zacks Ranks #4 and 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
While earnings beat looks uncertain for Cheniere Energy Partners LP, here are some firms from the energy space you may want to consider on the basis of our model, which shows that they have the right combination of elements to post earnings beat this quarter:
Comstock Resources Inc. (CRK - Free Report) has an Earnings ESP of +0.94% and a Zacks Rank #2. The company is likely to release earnings on Nov 8.
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Cheniere Energy Partners (CQH): Q3 Earnings to Surprise?
Cheniere Energy Partners LP Holdings LLC is expected to report third-quarter 2016 results before the opening bell on Thursday, Nov 3.
In each of the last four quarters, the partnership delivered an earnings surprise of 0.00%.
Let’s see how things are shaping up for this announcement.
Factors to Consider This Quarter
Cheniere Energy Partners LP Holdings, by virtue of its 55.9% ownership in Cheniere Energy Partners LP (CQP - Free Report) , primarily operates the Sabine Pass natural gas regasification and liquefaction facilities. Cheniere Energy Partners LP Holdings also operates Creole Trail Pipeline located in Louisiana. This solid asset base might help the partnership to earn sufficiently for its shareholders.
Moreover, the fate of the midstream player’s business is positively correlated with natural gas production. The output of the commodity in the U.S. has been booming owing to hydraulic fracturing (or fracking) and sophisticated horizontal drilling techniques. In fact, it has been an oversupplied market for the commodity over the past few quarters. The same is applicable for the third quarter.
Hence, we can say that the business environment was favorable for the partnership as higher production of natural gas usually increases the need for regasification, liquefaction and transportation activities. Yet, we have to wait for the final earnings release to find out whether this increase in output translates into a positive surprise.
CHENIERE EP LP Price and EPS Surprise
CHENIERE EP LP Price and EPS Surprise | CHENIERE EP LP Quote
Earnings Whispers
Our proven model does not conclusively show that Cheniere Energy Partners LP Holdings will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat consensus estimates. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
That is not the case here, as you will see below.
Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 2 cents, resulting in an Earnings ESP of 0.00%.
Zacks Rank: Cheniere Energy Partners LP has a Zacks Rank #3. Though a Zacks Rank #3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult.
We caution against Sell-rated stocks (Zacks Ranks #4 and 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
While earnings beat looks uncertain for Cheniere Energy Partners LP, here are some firms from the energy space you may want to consider on the basis of our model, which shows that they have the right combination of elements to post earnings beat this quarter:
Archrock Partners L.P. has an Earnings ESP of +8.33% and a Zacks Rank #1. The partnership is expected to release earnings results on Nov 1. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Comstock Resources Inc. (CRK - Free Report) has an Earnings ESP of +0.94% and a Zacks Rank #2. The company is likely to release earnings on Nov 8.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>