Back to top

Surging Earnings Estimates Signal Upside for NGL Energy Partners LP (NGL) Stock

Read MoreHide Full Article

Investors might want to bet on NGL Energy Partners LP (NGL - Free Report) , as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook.

The upward trend in estimate revisions for this company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

For NGL Energy Partners LP, there has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year.

The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:

12 Month EPS

Current-Quarter Estimate Revisions

The company is expected to earn $0.03 per share for the current quarter, which represents a year-over-year change of +107.5%.

Over the last 30 days, one estimate has moved higher for NGL Energy Partners LP while one has gone lower. As a result, the Zacks Consensus Estimate has increased 350%.

Current-Year Estimate Revisions

For the full year, the company is expected to earn $0.89 per share, representing a year-over-year change of +170.63%.

There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, three estimates have moved up for NGL Energy Partners LP versus no negative revisions. This has pushed the consensus estimate 103.43% higher.

Favorable Zacks Rank

The promising estimate revisions have helped NGL Energy Partners LP earn a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

NGL Energy Partners LP shares have added 7.8% over the past four weeks, suggesting that investors are betting on its impressive estimate revisions. So, you may consider adding it to your portfolio right away to benefit from its earnings growth prospects.


In-Depth Zacks Research for the Tickers Above


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


NGL Energy Partners LP (NGL) - free report >>

Published in