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Gran Tierra (GTE) to Report Q4 Earnings: What's in the Cards?

Zacks Equity Research

Gran Tierra Energy Inc. GTE is scheduled to reportfourth-quarter 2018 results on Feb 27, before the opening bell.

In the last reported quarter, the upstream energy player posted a positive earnings surprise of 200%. Moreover, the company has an average positive earnings surprise of 24% for the last four quarters.

Which Way Are Estimates Treading?

Let’s take a look at the estimate revision trend to get a clear picture of analyst opinion on the stock before the earnings release.

The Zacks Consensus Estimate for fourth-quarter 2018 earnings of 6 cents remained the same in the past seven days. The estimate reflects a year-over-year improvement of 50%.

Further, the consensus estimate for revenues of $154.4 million shows an increase of 21.4% from the year-ago quarter.

Factors Likely to Affect Results

Through fourth-quarter 2018, the Brent crude plunged from an average monthly price of 81.03 a barrel in October to $57.36 in December last year, per the U.S. Energy Information Administration.  

Being an oil explorer and producer in Colombia, the decline in commodity price will likely prove unfavorable. Despite this, the company’s production increased during the quarter.  Gran Tierra recently announced that its daily fourth-quarter 2018 production grew 11% year over year and 6% sequentially to 38,220 barrels of oil equivalent (BoE). 

Earnings Whispers

Our proven model does not show a beat for Gran Tierra this earnings season. That is because 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. That is not the case here as you will see below.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -33.33%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Gran Tierra carries a Zacks Rank #2, which when combined with an Earnings ESP of -33.33%, lowers the possibility of an earnings surprise.        

Conversely, Sell-rated stocks (Zacks Rank #4 and 5) should never be considered going into an earnings announcement.

Stocks to Consider

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 beat estimates this quarter.

Par Pacific Holdings, Inc. PARR has a Zacks Rank #2 and an Earnings ESP of +21.70%. The company will report quarterly earnings on Mar 5. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earthstone Energy, Inc. ESTE has a Zacks Rank #3 and an Earnings ESP of +6.52%.

Goodrich Petroleum Corporation GDP has a Zacks Rank #3 and an Earnings ESP of +2.36%. The company will release quarterly earnings on Mar 5.

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