Anadarko Petroleum Corporation (NYSE:APC) is likely to beat earnings estimates when it reports fourth-quarter 2017 results on Feb 6. In the third quarter, the oil and gas company reported a negative earnings surprise of 37.5%.
Why Likely a Positive Surprise
A stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Our model conclusively shows that Anadarko Petroleum is likely to beat earnings this quarter as it possesses both the components.
Zacks ESP: The company’s Earnings ESP is +110.07%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Anadarko Petroleum’s Zacks Rank #3, when combined with a positive Earnings ESP, increases the possibility of a beat. You can see the complete list of today’s Zacks #1 Rank stocks here.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Anadarko Petroleum Corporation Price, Consensus and EPS Surprise
Factors to Consider
Anadarko Petroleum intended to buy back shares worth $1 billion in 2017 from its authorized $2.5 billion share buyback program, which will definitely increase value of existing shareholders. The company’s focus on high-quality oil plays and sale of Moxa gas assets are expected to improve margins.
Anadarko Petroleum expects average daily sales volume in the range of 609,000-630,000 barrels of oil equivalent per day (BOE/d) for fourth-quarter 2017. Notably, the Zacks Consensus Estimate for total average daily volumes for the fourth quarter is pegged at 625,000 BOE/d, lower than 626,000 BOE/d reported in the third-quarter 2017.
Oil Sales contributed nearly 56% of total revenues of Anadarko Petroleum in the first nine months of 2017. The ongoing recovery in oil prices is expected to have a positive impact on its performance in the fourth quarter. The Zacks Consensus Estimate for Oil and Condensate daily volume is 362,000 barrels per day, which reflects an increase of 7.8% year over year.
Other Stocks to Consider
Apart from Anadarko Petroleum, here are some companies from the sector that you may want to consider instead, as our model shows that these too have the right combination of elements to post an earnings beat this quarter.
Continental Resources, Inc. (NYSE:CLR) has an Earnings ESP of +2.57% and a Zacks Rank #1. The company is expected to release fourth-quarter 2017 results on Feb 21.
Crescent Point Energy Corporation (TO:CPG) has an Earnings ESP of +33.33% and a Zacks Rank #2. The company is expected to release fourth-quarter 2017 results on Feb 22.
Chesapeake Energy Corporation (NYSE:CHK) has an Earnings ESP of +3.52% and a Zacks Rank #3. The company is expected to release fourth-quarter 2017 results on Feb 22.
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Crescent Point Energy Corporation (CPG): Free Stock Analysis Report
Chesapeake Energy Corporation (CHK): Free Stock Analysis Report
Anadarko Petroleum Corporation (APC): Free Stock Analysis Report
Continental Resources, Inc. (CLR): Free Stock Analysis Report
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