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Enterprise (EPD) to Report Q1 Earnings: What's in the Cards?
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Enterprise Products Partners LP (EPD - Free Report) is set to report first-quarter 2020 results on Apr 29, before the opening bell.
In the last reported quarter, the partnership reported earnings of 54 cents per unit, in line with the Zacks Consensus Estimate owing to higher sales volumes, and margins from the NGL Pipelines & Services business. Increased crude oil transportation volumes also aided the results.
The midstream infrastructure provider managed to beat the Zacks Consensus Estimate for earnings in two of the past four quarters while meeting the same on one occasion, with the average positive surprise being 5.4%. This is depicted in the graph below:
Enterprise Products Partners L.P. 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 first-quarter earnings of 52 cents per unit has seen two upward revisions and five downward movements in the past 60 days. The figure suggests a year-over-year decline of 8.8%.
Further, the Zacks Consensus Estimate for revenues is pegged at $8.3 billion for the quarter, indicating a decline of 2.8% from the year-ago reported figure.
Factors to Consider
Conservative capital spending by explorers due to low oil and gas prices and weak demand is expected to have slowed down onshore North American crude production in first-quarter 2019. As such, rig count in the region fell drastically in the quarter under review. This is likely to have affected commodity volumes transported through pipelines. Being a leading provider of midstream services in the continent, the partnership is expected to have seen a drop in earnings from the Crude Oil Pipelines & Services segment in the March quarter.
The Zacks Consensus Estimate for first-quarter gross operating margin at the Crude Oil Pipelines & Services segment is pegged at $450 million, suggesting a drop from $662 million reported in the year-ago quarter. The same for Onshore Natural Gas Pipelines & Services is pegged at $241 million, indicating a decline from the year-ago level of $264 million.
However, with growing demand for NGLs across almost all sectors of the economy, the partnership is likely to have benefited from higher transported volumes in the quarter under review. The Zacks Consensus Estimate for first-quarter gross operating margin from the NGL Pipelines & Services unit is pegged at $1,072 million, indicating a rise from $959 million a year ago.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Enterprise this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases chances of an earnings beat. But that’s not the case here as you will see below.
Earnings ESP: The partnership’s Earnings ESP is -0.08% as the Most Accurate Estimate is lower than the Zacks Consensus Estimate of 52 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Enterprise currently carries a Zacks Rank #3.
Stocks That Warrant a Look
While earnings beat looks uncertain for Enterprise, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Southwestern Energy Company (SWN - Free Report) has an Earnings ESP of +20.51% and is a Zacks #2 Ranked player. The company is scheduled to release first-quarter results after the market closes on Apr 30. You can see the complete list of today’s Zacks #1 Rank stocks here.
Enbridge Inc. (ENB - Free Report) has an Earnings ESP of +2.57% and a Zacks Rank of 3. It is scheduled to report first-quarter results on May 7.
DCP Midstream Partners, LP has an Earnings ESP of +2.99% and holds a Zacks Rank #3. It is set to report first-quarter results on May 6.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Enterprise (EPD) to Report Q1 Earnings: What's in the Cards?
Enterprise Products Partners LP (EPD - Free Report) is set to report first-quarter 2020 results on Apr 29, before the opening bell.
In the last reported quarter, the partnership reported earnings of 54 cents per unit, in line with the Zacks Consensus Estimate owing to higher sales volumes, and margins from the NGL Pipelines & Services business. Increased crude oil transportation volumes also aided the results.
The midstream infrastructure provider managed to beat the Zacks Consensus Estimate for earnings in two of the past four quarters while meeting the same on one occasion, with the average positive surprise being 5.4%. This is depicted in the graph below:
Enterprise Products Partners L.P. Price and EPS Surprise
Enterprise Products Partners L.P. price-eps-surprise | Enterprise Products Partners L.P. Quote
Let’s see how things have shaped up prior to the announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for first-quarter earnings of 52 cents per unit has seen two upward revisions and five downward movements in the past 60 days. The figure suggests a year-over-year decline of 8.8%.
Further, the Zacks Consensus Estimate for revenues is pegged at $8.3 billion for the quarter, indicating a decline of 2.8% from the year-ago reported figure.
Factors to Consider
Conservative capital spending by explorers due to low oil and gas prices and weak demand is expected to have slowed down onshore North American crude production in first-quarter 2019. As such, rig count in the region fell drastically in the quarter under review. This is likely to have affected commodity volumes transported through pipelines. Being a leading provider of midstream services in the continent, the partnership is expected to have seen a drop in earnings from the Crude Oil Pipelines & Services segment in the March quarter.
The Zacks Consensus Estimate for first-quarter gross operating margin at the Crude Oil Pipelines & Services segment is pegged at $450 million, suggesting a drop from $662 million reported in the year-ago quarter. The same for Onshore Natural Gas Pipelines & Services is pegged at $241 million, indicating a decline from the year-ago level of $264 million.
However, with growing demand for NGLs across almost all sectors of the economy, the partnership is likely to have benefited from higher transported volumes in the quarter under review. The Zacks Consensus Estimate for first-quarter gross operating margin from the NGL Pipelines & Services unit is pegged at $1,072 million, indicating a rise from $959 million a year ago.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Enterprise this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases chances of an earnings beat. But that’s not the case here as you will see below.
Earnings ESP: The partnership’s Earnings ESP is -0.08% as the Most Accurate Estimate is lower than the Zacks Consensus Estimate of 52 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Enterprise currently carries a Zacks Rank #3.
Stocks That Warrant a Look
While earnings beat looks uncertain for Enterprise, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Southwestern Energy Company (SWN - Free Report) has an Earnings ESP of +20.51% and is a Zacks #2 Ranked player. The company is scheduled to release first-quarter results after the market closes on Apr 30. You can see the complete list of today’s Zacks #1 Rank stocks here.
Enbridge Inc. (ENB - Free Report) has an Earnings ESP of +2.57% and a Zacks Rank of 3. It is scheduled to report first-quarter results on May 7.
DCP Midstream Partners, LP has an Earnings ESP of +2.99% and holds a Zacks Rank #3. It is set to report first-quarter results on May 6.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>