Coterra (CTRA) Gears Up for Q2 Earnings: Here's How It Will Fare
Coterra Energy Inc. CTRA is set to release second-quarter results on Aug 7. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 36 cents per share on revenues of $1.3 billion.
Let’s delve into the factors that might have influenced the oil and gas exploration and production firm’s performance in the June quarter. But it’s worth taking a look at CTRA’s previous-quarter performance first.
Highlights of Q1 Earnings & Surprise History
In the last reported quarter, the Houston, TX-based upstream energy company beat the consensus mark on strong production. CTRA had reported adjusted earnings per share of 87 cents, beating the Zacks Consensus Estimate of 71 cents. Meanwhile, revenues of $1.8 billion generated by the firm came in 9.8% above the Zacks Consensus Estimate.
Coterra Energy beat the Zacks Consensus Estimate for earnings in each of the last four quarters, resulting in an earnings surprise of 10.5%, on average. This is depicted in the graph below:
Coterra Energy Inc. Price and EPS Surprise
Coterra Energy Inc. price-eps-surprise | Coterra Energy Inc. Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for the second-quarter bottom line remained unchanged in the past seven days. The estimated figure indicates a 73.3% drop year over year. The Zacks Consensus Estimate for revenues, meanwhile, suggests a 50.2% decrease from the year-ago period.
Factors to Consider
Coterra Energy is expected to have reaped the reward of higher production during the quarter. CTRA continues to churn out an impressive output from its assets in the Permian Basin, Marcellus Shale and Anadarko Basin. In the previous quarter, the company’s production edged up 0.8% to 635 thousand barrels of oil equivalent per day. The uptick is expected to have continued in the to-be-reported quarter on the back of better well performance and improved cycle times.
But on a somewhat bearish note, a dip in commodity realizations might have dampened the positives associated with production gains. In the first quarter of 2023, the company’s average realized oil price decreased by 20.8% from the year-ago period, while natural gas fetched 23.6% less. The decline is most likely to have continued in the second quarter, with investors opting for safer assets due to concerns about a slowing global economy.
What Does Our Model Say?
The proven Zacks model does not conclusively show that CTRA is likely to beat estimates in the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Coterra Energy has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 36 cents per share each.
Zacks Rank: CTRA currently carries a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult this earnings season.
Stocks to Consider
While an earnings beat looks uncertain for Coterra Energy, here are some firms that you may want to consider on the basis of our model:
AECOM ACM has an Earnings ESP of +1.05% and a Zacks Rank #2. The firm is scheduled to release earnings on Aug 7.
You can see the complete list of today’s Zacks #1 Rank stocks here.
AECOM beat the Zacks Consensus Estimate for earnings in each of the last four quarters. It has a trailing four-quarter earnings surprise of 4.8%, on average. Valued at around $12.2 billion, AECOM has gained 22.1% in a year.
American Equity Investment Life Holding Company AEL has an Earnings ESP of +0.77% and a Zacks Rank #2. The firm is scheduled to release earnings on Aug 7.
For 2023, AEL has a projected earnings growth rate of 76.6%. Valued at around $4.2 billion, American Equity Investment Life Holding Company has gained 43.9% in a year.
ALLETE Inc. ALE has an Earnings ESP of +2.56% and a Zacks Rank #3. The firm is scheduled to release earnings on Aug 8.
For 2023, ALLETE has a projected earnings growth rate of 7.4%. Valued at around $3.3 billion, ALE has lost 7.6% in a year.
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