Will Anadarko Petroleum (APC) Miss Earnings Estimates in Q2?

Zacks Equity Research

Updated Thu, Jul 20, 2017, 9:39 AM

Anadarko Petroleum Corporation APC will release second-quarter 2017 financial results after the market closes on Jul 24, 2017. In the prior quarter, the oil and gas company reported a negative earnings surprise of 130.77%. Let’s see how things are shaping up at the company prior to this announcement.

Factors to Consider

The company is presently streamlining its operations. It has divested Eagleford and Marcellus assets worth nearly $2.8 billion and is working to improve oil production from its existing assets.

Due to the tragic incident in Colorado during the second quarter, Anadarko has shut all its producing vertical wells operating in the regions. These wells will resume operations post necessary inspection, which produced 13,000 net barrels of oil equivalent per day. So, this unexpected shut down could impact production goals.

Earnings Whispers

Our proven model does not show that Anadarko Petroleum is going to 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) for this to happen. But that is not the case here, as you will see below.

Zacks ESP: Anadarko Petroleum has an Earnings ESP of -6.67%. This is because the Most Accurate estimate stands at a loss of 32 cents, wider than the Zacks Consensus Estimate of a loss of 30 cents.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company’s Zacks Rank #4 (Sell) when combined with its negative ESP, makes positive surprise unlikely this season.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Anadarko Petroleum Corporation Price and EPS Surprise

Anadarko Petroleum Corporation Price and EPS Surprise | Anadarko Petroleum Corporation Quote

Stocks to Consider

Anadarko Petroleum does not have the right parameters to come out with earning surprise this season. However, we have a few players in the Zacks categorized Oil &Gas – Exploration & Production – U.S. industry, which have the right combination of elements to post an earnings beat this quarter.

EQT Corporation EQT has an Earnings ESP of +42.86% and a Zacks Rank #3. It is slated to report second-quarter earnings on Jul 26. You can see the complete list of today’s Zacks #1 Rank stocks here.

Southwestern Energy Company SWN has an Earnings ESP of +11.77% and a Zacks Rank #3. It is expected to report second-quarter earnings on Aug 3.

EXTRACTION OIL & GAS, LLC XOG is expected to report second-quarter 2017 earnings on Aug 9. It has an Earnings ESP of +28.57% and a Zacks Rank #3.

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