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What to Look for in Cheniere Energy's (LNG) Q4 Earnings?
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Cheniere Energy, Inc. (LNG - Free Report) is set to release fourth-quarter results on Feb 23. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $6.87 per share on revenues of $8.7 billion.
Let’s delve into the factors that might have influenced the liquefied natural gas exporter’s performance in the December quarter. But it’s worth taking a look at Cheniere Energy’s previous-quarter performance first.
Highlights of Q3 Earnings & Surprise History
In the last-reported quarter, this Houston, TX-based transporter of super-chilled fuel crushed the consensus mark on high natural gas prices and increasing demand from customers looking to replace Russian energy. Cheniere Energy had reported adjusted earnings per share of $7.80 that comprehensively beat the Zacks Consensus Estimate of $5.46. The company’s quarterly revenues of $8.9 billion also outperformed the Zacks Consensus Estimate by 10.1%.
Cheniere Energy beat the Zacks Consensus Estimate thrice in the last four quarters and missed in the other, ending up with an earnings surprise of 0.2%, on average. This is depicted in the graph below:
The Zacks Consensus Estimate for the fourth-quarter bottom line has remained the same in the last seven days. The estimated figure indicates a 687.2% surge year over year. The Zacks Consensus Estimate for revenues, meanwhile, suggests a 32.9% increase from the year-ago period.
Factors to Consider
LNG shipments for export from the United States have been robust for months on the back of environmental reasons and record-high prices of the super-chilled fuel elsewhere. Now, with the Russia-Ukraine conflict, LNG has become even more coveted, with an increasing number of countries vying for the American-made fuel to replace supplies from Moscow. This means that LNG deliveries are poised to rise further. This augurs well for Cheniere Energy — the dominant U.S. LNG exporter — in the to-be-reported quarter. As proof of this bullish backdrop, the Zacks Consensus Estimate for fourth-quarter LNG revenues is pegged at $8.3 billion, suggesting a whopping increase from the year-ago level of $3.6 billion.
On a somewhat bearish note, though, Cheniere Energy’s operating costs and expenses in the third quarter more than doubling year over year to $11.9 billion. The upward cost trajectory is likely to have continued in the to-be-reported period due to the prevailing inflationary environment. Moreover, the export of natural gas by setting up large liquefication plants is an extremely capital-intensive undertaking, with each unit running up multi-billion-dollar bills.
What Does Our Model Say?
The proven Zacks model does not conclusively show that Cheniere Energy is likely to beat estimates in the fourth 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: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, for this company is -20.81%.
Zacks Rank: Cheniere Energy currently carries a Zacks Rank #3.
While an earnings beat looks uncertain for Cheniere Energy, here are some firms from the energy space that you may want to consider on the basis of our model:
Northern Oil and Gas, Inc. (NOG - Free Report) has an Earnings ESP of +0.23% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 23.
For 2023, Northern Oil and Gas has a projected earnings growth rate of 114.3%. Valued at around $2.5 billion, PUMP has gained 36% in a year.
Occidental Petroleum (OXY - Free Report) has an Earnings ESP of +0.96% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 27.
For 2022, Occidental Petroleum has a projected earnings growth rate of 276.5%. Valued at around $55.2 billion, OXY has gained 54.6% in a year.
EOG Resources, Inc. (EOG - Free Report) has an Earnings ESP of +0.21% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 23.
For 2022, EOG has a projected earnings growth rate of 59%. Valued at around $69.6 billion, EOG has gained 6.1% in a year.
Image: Bigstock
What to Look for in Cheniere Energy's (LNG) Q4 Earnings?
Cheniere Energy, Inc. (LNG - Free Report) is set to release fourth-quarter results on Feb 23. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $6.87 per share on revenues of $8.7 billion.
Let’s delve into the factors that might have influenced the liquefied natural gas exporter’s performance in the December quarter. But it’s worth taking a look at Cheniere Energy’s previous-quarter performance first.
Highlights of Q3 Earnings & Surprise History
In the last-reported quarter, this Houston, TX-based transporter of super-chilled fuel crushed the consensus mark on high natural gas prices and increasing demand from customers looking to replace Russian energy. Cheniere Energy had reported adjusted earnings per share of $7.80 that comprehensively beat the Zacks Consensus Estimate of $5.46. The company’s quarterly revenues of $8.9 billion also outperformed the Zacks Consensus Estimate by 10.1%.
Cheniere Energy beat the Zacks Consensus Estimate thrice in the last four quarters and missed in the other, ending up with an earnings surprise of 0.2%, on average. This is depicted in the graph below:
Cheniere Energy, Inc. Price and EPS Surprise
Cheniere Energy, Inc. price-eps-surprise | Cheniere Energy, Inc. Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for the fourth-quarter bottom line has remained the same in the last seven days. The estimated figure indicates a 687.2% surge year over year. The Zacks Consensus Estimate for revenues, meanwhile, suggests a 32.9% increase from the year-ago period.
Factors to Consider
LNG shipments for export from the United States have been robust for months on the back of environmental reasons and record-high prices of the super-chilled fuel elsewhere. Now, with the Russia-Ukraine conflict, LNG has become even more coveted, with an increasing number of countries vying for the American-made fuel to replace supplies from Moscow. This means that LNG deliveries are poised to rise further. This augurs well for Cheniere Energy — the dominant U.S. LNG exporter — in the to-be-reported quarter. As proof of this bullish backdrop, the Zacks Consensus Estimate for fourth-quarter LNG revenues is pegged at $8.3 billion, suggesting a whopping increase from the year-ago level of $3.6 billion.
On a somewhat bearish note, though, Cheniere Energy’s operating costs and expenses in the third quarter more than doubling year over year to $11.9 billion. The upward cost trajectory is likely to have continued in the to-be-reported period due to the prevailing inflationary environment. Moreover, the export of natural gas by setting up large liquefication plants is an extremely capital-intensive undertaking, with each unit running up multi-billion-dollar bills.
What Does Our Model Say?
The proven Zacks model does not conclusively show that Cheniere Energy is likely to beat estimates in the fourth 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: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, for this company is -20.81%.
Zacks Rank: Cheniere Energy currently carries a Zacks Rank #3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks to Consider
While an earnings beat looks uncertain for Cheniere Energy, here are some firms from the energy space that you may want to consider on the basis of our model:
Northern Oil and Gas, Inc. (NOG - Free Report) has an Earnings ESP of +0.23% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 23.
For 2023, Northern Oil and Gas has a projected earnings growth rate of 114.3%. Valued at around $2.5 billion, PUMP has gained 36% in a year.
Occidental Petroleum (OXY - Free Report) has an Earnings ESP of +0.96% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 27.
For 2022, Occidental Petroleum has a projected earnings growth rate of 276.5%. Valued at around $55.2 billion, OXY has gained 54.6% in a year.
EOG Resources, Inc. (EOG - Free Report) has an Earnings ESP of +0.21% and a Zacks Rank #3. The firm is scheduled to release earnings on Feb 23.
For 2022, EOG has a projected earnings growth rate of 59%. Valued at around $69.6 billion, EOG has gained 6.1% in a year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.