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Can Magnolia Oil & Gas Corp (MGY) Run Higher on Rising Earnings Estimates?
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Magnolia Oil & Gas Corp (MGY - Free Report) could be a solid addition to your portfolio given a notable revision in the company's earnings estimates. While the stock has been gaining lately, the trend might continue since its earnings outlook is still improving.
The upward trend in estimate revisions for this company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For Magnolia Oil & Gas Corp, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.
The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:
12 Month EPS
Current-Quarter Estimate Revisions
The company is expected to earn $1.17 per share for the current quarter, which represents a year-over-year change of +108.93%.
Over the last 30 days, the Zacks Consensus Estimate for Magnolia Oil & Gas Corp has increased 6.36% because two estimates have moved higher while two have gone lower.
Current-Year Estimate Revisions
For the full year, the earnings estimate of $4.46 per share represents a change of +84.3% from the year-ago number.
The revisions trend for the current year also appears quite promising for Magnolia Oil & Gas Corp, with three estimates moving higher over the past month compared to one negative revision. The consensus estimate has also received a boost over this time frame, increasing 7.57%.
Favorable Zacks Rank
Thanks to promising estimate revisions, Magnolia Oil & Gas Corp currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Bottom Line
While strong estimate revisions for Magnolia Oil & Gas Corp have attracted decent investments and pushed the stock 30.7% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.
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Can Magnolia Oil & Gas Corp (MGY) Run Higher on Rising Earnings Estimates?
Magnolia Oil & Gas Corp (MGY - Free Report) could be a solid addition to your portfolio given a notable revision in the company's earnings estimates. While the stock has been gaining lately, the trend might continue since its earnings outlook is still improving.
The upward trend in estimate revisions for this company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For Magnolia Oil & Gas Corp, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.
The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:
12 Month EPS
Current-Quarter Estimate Revisions
The company is expected to earn $1.17 per share for the current quarter, which represents a year-over-year change of +108.93%.
Over the last 30 days, the Zacks Consensus Estimate for Magnolia Oil & Gas Corp has increased 6.36% because two estimates have moved higher while two have gone lower.
Current-Year Estimate Revisions
For the full year, the earnings estimate of $4.46 per share represents a change of +84.3% from the year-ago number.
The revisions trend for the current year also appears quite promising for Magnolia Oil & Gas Corp, with three estimates moving higher over the past month compared to one negative revision. The consensus estimate has also received a boost over this time frame, increasing 7.57%.
Favorable Zacks Rank
Thanks to promising estimate revisions, Magnolia Oil & Gas Corp currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Bottom Line
While strong estimate revisions for Magnolia Oil & Gas Corp have attracted decent investments and pushed the stock 30.7% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.