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What's in the Cards for WPX Energy's (WPX) Q1 Earnings?

Zacks Equity Research

We expect WPX Energy, Inc. WPX to beat estimates when it reports first-quarter 2019 results on May 1, after market close. In the last reported quarter, the company delivered a negative surprise of 60%.

What the Zacks Model Unveils

Our proven model shows that WPX Energy is likely to beat estimates in the to-be-reported quarter because it has the right combination of two key ingredients. A stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates.

Earnings ESP: The company’s Earnings ESP is +8.73%. This is a meaningful and leading indicator of a likely positive surprise.
 
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: WPX Energy currently carries a Zacks Rank #3. The combination of WPX Energy’s favorable Zacks Rank and positive ESP makes us reasonably confident of a positive surprise this season.

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

WPX Energy, Inc. Price and EPS Surprise

WPX Energy, Inc. Price and EPS Surprise | WPX Energy, Inc. Quote

Factors to Consider

WPX Energy’s production has been steadily improving owing to high-quality assets in Delaware and Williston Basins, which is a positive for the to-be-reported quarter as well. Focus on increasing oil production and reducing operating cost in Delaware is likely to boost its performance in the first quarter.

The strategic transformation of WPX Energy via selling off non-core assets and lowering long-term debt is likely to have a positive impact on first-quarter results. The company has been expanding midstream operation in the Permian Basin, which will likely boost its performance.

The Zacks Consensus Estimate for first-quarter 2019 total production of the company is pegged at 159,000 barrels per day, which indicates an increase of 54.4% from the year-ago reported figure.

Other Stocks to Consider

WPX Energy is not the only company that is looking up this earnings season. One can also consider the following companies from the same industry that have the right combination of the key ingredients to post an earnings beat in the upcoming releases.

Apache Corporation APA has an Earnings ESP of +12.55% and carries a Zacks Rank #2. It is slated to report first-quarter 2019 results on May 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cimarex Energy Co. XEC has an Earnings ESP of +1.95% and a Zacks Rank #2. It is scheduled to report first-quarter 2019 results on May 8.

Cheniere Energy Inc. LNG has an Earnings ESP of +5.01% and carries a Zacks Rank #3. It is slated to report first-quarter 2019 results on May 9.

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