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MPLX Gears Up to Report Q3 Earnings: What's in the Cards?

Zacks Equity Research

MPLX LP MPLX is set to report third-quarter 2019 results on Oct 31, before the opening bell.

Which Way are Estimates Headed?

Let’s take a look at the estimate revision trend to get a clear picture of what analysts feel about the partnership prior to the upcoming earnings release.

The Zacks Consensus Estimate for third-quarter earnings of 59 cents has seen no upward revision and four downward movements in the past 30 days. The figure suggests a year-over-year decline of 4.8%.

Further, the Zacks Consensus Estimate for revenues is pegged at $2.2 billion for the quarter, indicating an improvement of 31.1% from the year-ago reported figure.

Factors to Consider

The Zacks Consensus Estimate for the partnership’s product pipelines throughput volumes is pegged at 1,189 thousand barrels per day (MB/D), suggesting a marginal rise over 1,182 MB/D in the September quarter of 2018. Moreover, the consensus estimate for average tariff rates from the product pipelines is pegged at 86 cents per barrel, suggesting no movement in comparison to the year-ago quarter. Hence, favorable tariff rates and higher throughput volumes from the product pipelines are likely to have favored the partnership’s bottom line.

Investors should also note that the Zacks Consensus Estimate for the partnership’s crude oil pipelines throughput volumes is at 2,557 MB/D, higher than 2,208 MB/D in a year-ago quarter. Markedly, the consensus estimate for average tariff rates from the crude oil pipelines is pegged at 60 cents per barrel, which suggests no change from the year-ago figure. Thus, the crude oil pipelines are expected to have contributed to the partnership’s earnings in the third quarter. 

Earnings Whispers

Our proven model does not indicate an earnings beat for MPLX. 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 is not the case here as you will see below.  

Earnings ESP: The partnership’s Earnings ESP is -1.84% as the Most Accurate Estimate of 58 cents per unit is pegged lower than the Zacks Consensus Estimate of 59 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: MPLX currently carries a Zacks Rank #3.

Highlights of Q2 Earnings & Earnings History

In the last reported quarter, MPLX – sponsored by Marathon Petroleum MPC – delivered earnings of 55 cents per unit that missed the Zacks Consensus Estimate of 60 cents. However, quarterly earnings were flat year over year.   

However, the midstream service provider has an average negative earnings surprise of 5.39% for the past four quarters, as shown in the chart below.

MPLX LP Price and EPS Surprise

 

MPLX LP Price and EPS Surprise

MPLX LP price-eps-surprise | MPLX LP Quote

Stocks That Warrant a Look

Though an earnings beat looks uncertain for MPLX, 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 post an earnings beat in the upcoming quarterly reports:   

Continental Resources Inc CLR has an Earnings ESP of +4.60% and is Zacks #3 Ranked. The company is scheduled to release earnings on Oct 30. You can see the complete list of today’s Zacks #1 Rank stocks here

Gulfport Energy Corporation GPOR has an Earnings ESP of +3.57% and a Zacks Rank #3. The company is set to release earnings on Oct 31.

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