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EOG Resources (EOG) to Report Q4 Earnings: What's in Store?

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EOG Resources, Inc. (EOG - Free Report) is slated to report fourth-quarter 2019 results on Feb 27, after the closing bell.

In the last reported quarter, the company came up with adjusted earnings of $1.13 per share that lagged the Zacks Consensus Estimate by 0.9% due to lower average price realization for crude oil and natural gas. Notably, EOG Resources beat estimates once in the last four quarters, as shown in the chart below.

EOG Resources, Inc. Price and EPS Surprise

Let’s see how things have shaped up prior to the announcement.

Trend in Estimate Revision

The Zacks Consensus Estimate for fourth-quarter earnings per share of $1.16 has witnessed two upward revisions and one downward movement in the past 30 days. This estimate is indicative of a 6.5% decrease from the year-ago reported figure.

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $4.4 billion, suggesting a decrease of 4.4% from the year-ago reported figure.

Factors to Consider

The upstream energy player has an attractive portfolio of acreages in oil shale plays like the Permian, Bakken and Eagle Ford, which will likely support fourth-quarter results. The Zacks Consensus Estimate for the company’s fourth-quarter crude oil equivalent volumes is pegged at 845 thousand barrels of oil equivalent per day (MBoe/d), suggesting a rise from the year-ago quarter’s 764.5 MBoe/d on higher production from resources in the United States.

The consensus mark for crude oil and condensate production volume for the quarter is pegged at 467 MBbls/d, implying a rise from the year-ago period’s 435.6 MBbls/d. As EOG Resources is an exploration and production company whose total production significantly constitutes oil, the potential increase in crude equivalent volumes is likely to have driven the bottom line in the fourth quarter.

However, the Zacks Consensus Estimate for the explorer’s average crude oil and condensate prices is pegged at $58 per barrel, indicating a decline from $59.47 in the year-ago quarter. Lower realized oil prices are expected to have partly hurt profit levels. Moreover, realized prices for natural gas liquids are estimated at $14.09 per barrel, indicating a decline from the year-ago level of $23.54.

Earnings Whispers

Our proven model does not indicate an earnings beat for EOG Resources. 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. That is not the case here as you will see below.    

Earnings ESP: The company’s Earnings ESP is -7.18% as the Most Accurate Estimate is pegged at $1.08 per share, lower than the Zacks Consensus Estimate of $1.16. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: EOG Resources currently carries a Zacks Rank #3.

Stocks That Warrant a Look

Though an earnings beat looks uncertain for EOG Resources, here are a few firms that you may want to consider on the basis of our model. These have the right combination of elements to post an earnings beat in the upcoming quarterly reports:

EQT Corporation (EQT - Free Report) has an Earnings ESP of +104.56% and a Zacks Rank #3. The company is set to release quarterly earnings on Feb 27. You can see the complete list of today’s Zacks #1 Rank stocks here.

Continental Resources, Inc. (CLR - Free Report) has an Earnings ESP of +13.15% and a Zacks Rank #3. The company is set to release quarterly earnings on Feb 26.

Matador Resources Company (MTDR - Free Report) has an Earnings ESP of +0.45% and a Zacks Rank #3. The company is set to release quarterly earnings on Feb 25.

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