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How Will Murphy USA (MUSA) Fair in Its Upcoming Q2 Earnings?
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Murphy USA (MUSA - Free Report) is set to release second-quarter results on Jul 27. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $4.65 per share on revenues of $6.1 billion.
Let’s delve into the factors that might have influenced the downstream operator’s results in the June quarter. But it’s worth taking a look at MUSA’s previous-quarter performance first.
Highlights of Q1 Earnings
In the last-reported quarter, the El Dorado, AR-based motor fuel retailer beat the consensus mark due to a rise in the retail gasoline price and a higher margin. MUSA had reported earnings per share of $6.08, well above the Zacks Consensus Estimate of $2.65. Moreover, revenues of $5.1 billion generated by the firm stormed past the Zacks Consensus Estimate of $4.6 billion primarily on the back of improved petroleum product sales.
Murphy USA beat the Zacks Consensus Estimate for earnings in each of the last four quarters, resulting in an earnings surprise of 49.1%, on average. This is depicted in the graph below:
The Zacks Consensus Estimate for the second-quarter bottom line has remained the same in the last seven days. The estimated figure indicates a 2.9% fall year over year. The Zacks Consensus Estimate for revenues, however, suggests a 36.7% increase from the year-ago period.
Factors to Consider
In the first quarter of 2022, the company’s retail gallons rose 7.8% from the year-ago period to 1,088.3 million. The positive momentum is most likely to have continued in the second quarter, thanks to a marked improvement in fuel consumption on the back of strong travel demand. Consequently, the Zacks Consensus Estimate for Murphy USA’s retail fuel volumes in the April-June period is pegged at 1,196 million gallons, up from the prior-year quarter’s level of 1,123 million gallons. This is likely to have buoyed the results of MUSA.
Murphy USA is also expected to have benefited from a better margin environment. The company’s first-quarter fuel margins widened to 23.30 cents per gallon from 15.50 cents in the corresponding period of 2021. With pushed-up crude differentials, the favorable margin story is likely to have continued in the to-be-reported quarter. As a reflection of this, the consensus mark for the second-quarter retail fuel margin stands at 25.80 cents per gallon, suggesting a rise of 18.3% from the year-ago period.
On a somewhat bearish note, the increase in Murphy USA’s costs might have dented the company’s to-be-reported bottom line. MUSA’s total operating expenses in the first quarter increased around 42% year over year to $4.9 billion. The upward cost trajectory is likely to have continued in the second quarter due to cost inflation and wage growth.
What Does Our Model Say?
The proven Zacks model does not conclusively show that Murphy USA is likely to beat estimates in the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: MUSA has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $4.65 per share each.
Zacks Rank: Murphy USA currently carries a Zacks Rank #1, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult this earnings season.
Stocks to Consider
While an earnings beat looks uncertain for Murphy USA, here are some firms from the energy space that you may want to consider on the basis of our model:
Range Resources Corporation (RRC - Free Report) has an Earnings ESP of +11.56% and a Zacks Rank #1. The firm is scheduled to release earnings on Jul 25.
RRC is valued at around $7.5 billion. The Zacks Consensus Estimate for the company’s 2022 earnings has been revised 9.1% upward over the past 60 days. Range Resources has surged around 82.4% in a year.
Liberty Energy Inc. (LBRT - Free Report) has an Earnings ESP of +46.25% and a Zacks Rank #1. The firm is scheduled to release earnings on Jul 25.
For 2022, LBRT has a projected earnings growth rate of 170.6%. Valued at around $2.3 billion, Liberty Energy has gained around 3.7% in a year.
Schlumberger Limited (SLB - Free Report) has an Earnings ESP of +1.15% and a Zacks Rank #2. The firm is scheduled to release earnings on Jul 22.
SLB topped the Zacks Consensus Estimate by an average of 6.7% in the trailing four quarters, including a 6.3% beat in Q1. Schlumberger has gained some 20.4% in a year.
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How Will Murphy USA (MUSA) Fair in Its Upcoming Q2 Earnings?
Murphy USA (MUSA - Free Report) is set to release second-quarter results on Jul 27. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $4.65 per share on revenues of $6.1 billion.
Let’s delve into the factors that might have influenced the downstream operator’s results in the June quarter. But it’s worth taking a look at MUSA’s previous-quarter performance first.
Highlights of Q1 Earnings
In the last-reported quarter, the El Dorado, AR-based motor fuel retailer beat the consensus mark due to a rise in the retail gasoline price and a higher margin. MUSA had reported earnings per share of $6.08, well above the Zacks Consensus Estimate of $2.65. Moreover, revenues of $5.1 billion generated by the firm stormed past the Zacks Consensus Estimate of $4.6 billion primarily on the back of improved petroleum product sales.
Murphy USA beat the Zacks Consensus Estimate for earnings in each of the last four quarters, resulting in an earnings surprise of 49.1%, on average. This is depicted in the graph below:
Murphy USA Inc. Price and EPS Surprise
Murphy USA Inc. price-eps-surprise | Murphy USA Inc. Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for the second-quarter bottom line has remained the same in the last seven days. The estimated figure indicates a 2.9% fall year over year. The Zacks Consensus Estimate for revenues, however, suggests a 36.7% increase from the year-ago period.
Factors to Consider
In the first quarter of 2022, the company’s retail gallons rose 7.8% from the year-ago period to 1,088.3 million. The positive momentum is most likely to have continued in the second quarter, thanks to a marked improvement in fuel consumption on the back of strong travel demand. Consequently, the Zacks Consensus Estimate for Murphy USA’s retail fuel volumes in the April-June period is pegged at 1,196 million gallons, up from the prior-year quarter’s level of 1,123 million gallons. This is likely to have buoyed the results of MUSA.
Murphy USA is also expected to have benefited from a better margin environment. The company’s first-quarter fuel margins widened to 23.30 cents per gallon from 15.50 cents in the corresponding period of 2021. With pushed-up crude differentials, the favorable margin story is likely to have continued in the to-be-reported quarter. As a reflection of this, the consensus mark for the second-quarter retail fuel margin stands at 25.80 cents per gallon, suggesting a rise of 18.3% from the year-ago period.
On a somewhat bearish note, the increase in Murphy USA’s costs might have dented the company’s to-be-reported bottom line. MUSA’s total operating expenses in the first quarter increased around 42% year over year to $4.9 billion. The upward cost trajectory is likely to have continued in the second quarter due to cost inflation and wage growth.
What Does Our Model Say?
The proven Zacks model does not conclusively show that Murphy USA is likely to beat estimates in the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: MUSA has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $4.65 per share each.
Zacks Rank: Murphy USA currently carries a Zacks Rank #1, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult this earnings season.
Stocks to Consider
While an earnings beat looks uncertain for Murphy USA, here are some firms from the energy space that you may want to consider on the basis of our model:
Range Resources Corporation (RRC - Free Report) has an Earnings ESP of +11.56% and a Zacks Rank #1. The firm is scheduled to release earnings on Jul 25.
You can see the complete list of today’s Zacks #1 Rank stocks here.
RRC is valued at around $7.5 billion. The Zacks Consensus Estimate for the company’s 2022 earnings has been revised 9.1% upward over the past 60 days. Range Resources has surged around 82.4% in a year.
Liberty Energy Inc. (LBRT - Free Report) has an Earnings ESP of +46.25% and a Zacks Rank #1. The firm is scheduled to release earnings on Jul 25.
For 2022, LBRT has a projected earnings growth rate of 170.6%. Valued at around $2.3 billion, Liberty Energy has gained around 3.7% in a year.
Schlumberger Limited (SLB - Free Report) has an Earnings ESP of +1.15% and a Zacks Rank #2. The firm is scheduled to release earnings on Jul 22.
SLB topped the Zacks Consensus Estimate by an average of 6.7% in the trailing four quarters, including a 6.3% beat in Q1. Schlumberger has gained some 20.4% in a year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.