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W&T Offshore (WTI) to Report Q1 Earnings: What Lies Ahead?

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W&T Offshore, Inc. WTI is set to report first-quarter 2021 earnings on May 4, after the closing bell.

In the previous quarter, the company reported an adjusted loss (excluding one-time items) of 5 cents per share, narrower than the Zacks Consensus Estimate of a loss of 13 cents due to lower costs and expenses, and higher natural gas prices. This was partially offset by a decline in average realized prices of liquids and oil equivalent production volumes.

Notably, the independent oil and natural gas producer has beat bottom-line estimates in all of the prior four quarters, the beat being 56.76%, on average, as shown in the chart below.

W&T Offshore, Inc. Price and EPS Surprise

W&T Offshore, Inc. Price and EPS Surprise
W&T Offshore, Inc. Price and EPS Surprise

W&T Offshore, Inc. price-eps-surprise | W&T Offshore, Inc. Quote

Let’s delve into the factors that are expected to have influenced the company’s performance in the March-ended quarter.

Estimate Trend

The Zacks Consensus Estimate for first-quarter earnings per share of 5 cents has witnessed one upward revision and no downward movement in the past 30 days. The estimate suggests an increase of 25% from the year-ago reported figure.

However, the Zacks Consensus Estimate for first-quarter revenues of $115 million indicates an 8% decline from the year-ago reported figure.

Factors at Play

In the first quarter of 2021, the price of crude oil improved significantly, owing to the rollout of coronavirus vaccines, which raised the outlook for global fuel demand. In fact, for the first time amid the coronavirus crisis, the commodity’s price reached the pre-pandemic mark in the March-ended quarter.

Notably, for the first quarter of 2021, the upstream firm expects production of 37,300-41,300 Boe/d. This suggests a production decline from 53,553 Boe/d reported in the first quarter of 2020.

Thus, although improved oil price is expected to have aided the company’s bottom line, lower production volumes are expected to have offset the positives.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for W&T Offshore this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here as you will see below.

Earnings ESP: W&T Offshores has an Earnings ESP of -11.11%. This is because the Most Accurate Estimate for the quarter under review is currently pegged at 4 cents per share, below the Zacks Consensus Estimate of 5 cents. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #2.

Stocks to Consider

While an earnings beat is uncertain for W&T Offshore, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:

Diamondback Energy, Inc. FANG has an Earnings ESP of +3.82% and it currently sports a Zacks Rank #1. The company is scheduled to release quarterly earnings on May 3, after market close. You can see the complete list of today’s Zacks #1 Rank stocks here.

NOW Inc. DNOW has an Earnings ESP of +31.37% and is a Zacks #2 Ranked player at present. It is scheduled to release first-quarter results before the opening bell on May 5.

Centennial Resource Development, Inc. CDEV currently has an Earnings ESP of +21. 88% and a Zacks Rank of 3. It is scheduled to report first-quarter results on May 4 after the closing bell.

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W&T Offshore, Inc. (WTI) : Free Stock Analysis Report

Diamondback Energy, Inc. (FANG) : Free Stock Analysis Report

NOW Inc. (DNOW) : Free Stock Analysis Report

Centennial Resource Development, Inc. (CDEV) : Free Stock Analysis Report

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