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Is a Beat Likely for Enterprise Products (EPD) in Q3 Earnings?

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Enterprise Products Partners LP (EPD - Free Report) is set to report third-quarter 2022 results on Nov 1, before the opening bell.

In the last reported quarter, the midstream infrastructure provider reported adjusted earnings per limited partner unit of 64 cents, beating the Zacks Consensus Estimate of 63 cents, thanks to higher contributions from the NGL Pipelines & Services business.

Enterprise Products beat the Zacks Consensus Estimate in two of the prior four quarters, met once and missed once, the average earnings surprise being 3.3%. This is depicted in the graph below:

Estimate Trend

The Zacks Consensus Estimate for third-quarter earnings of 61 cents per unit has seen one downward movement in the past seven days. The figure suggests a 17.3% year-over-year increase.

The Zacks Consensus Estimate for revenues is pegged at $13.9 billion for the quarter, indicating an increase of 27.8% from the year-ago reported figure.

Earnings Whispers

Our proven model predicts an earnings beat for Enterprise Products 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 the case here, as you will see below.

Earnings ESP: Earnings ESP for the partnership is +0.54%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Enterprise Products currently carries a Zacks Rank #3.

Factors to Consider

In the September quarter of 2022, the pricing scenario of both oil and natural gas was healthier year over year. A favorable environment for exploration and production activities is likely to have aided upstream activities, increasing production.

Higher production volumes are expected to have increased demand for transportation and storage assets, thereby favoring midstream players like Enterprise Products.

The Zacks Consensus Estimate for third-quarter gross operating margin from natural gas pipelines & services is pegged at $237 million, suggesting an increase from $223 million in third-quarter 2021. Our estimate for the metric is pegged at $226.4 million, also indicating a year-over-year improvement.

Other Energy Stocks With Favorable Combination

Here are some other firms worth considering, as these, too, have the right combination of elements to beat on earnings in the upcoming quarterly reports:

Viper Energy Partners LP (VNOM - Free Report) has an Earnings ESP of +7.09% and is a Zacks #3 Ranked player. You can see the complete list of today’s Zacks #1 Rank stocks here.

Viper Energy is scheduled to release third-quarter results on Nov 7. The Zacks Consensus Estimate for VNOM’s earnings is pegged at 38 cents per share, suggesting an increase of almost 81% from the prior-year quarter’s reported figure.

Diamondback Energy, Inc. (FANG - Free Report) has an Earnings ESP of +0.63% and a Zacks Rank of 3.

Diamondback is scheduled to report third-quarter results on Nov 7. The Zacks Consensus Estimate for FANG’s earnings is pegged at $6.45 per share, suggesting a significant increase from the prior-year quarter’s reported figure.

Cactus, Inc. (WHD - Free Report) has an Earnings ESP of +2.74% and a Zacks Rank #1.

Cactus is scheduled to release third-quarter earnings on Nov 7. The Zacks Consensus Estimate for WHD’s earnings is pegged at 49 cents per share, suggesting an increase of 157.9% from the prior-year quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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