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Factors to Take Into Account Ahead of BP's Q1 Earnings Release
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BP plc (BP - Free Report) is set to report first-quarter 2023 results on Feb 7.
In the last reported quarter, the leading integrated energy company’s adjusted earnings of $1.59 per American Depositary Share on a replacement-cost basis (excluding non-operating items) missed the Zacks Consensus Estimate of earnings of $1.65 per share. The quarterly results were driven by a decline in refinery throughputs and a fall in oil-equivalent production. This was offset partially by higher realizations of commodity prices.
In the trailing four quarters, BP beat the Zacks Consensus Estimate for earnings thrice and missed the same once, the average earnings surprise being 21.2%. This is depicted in the graph below:
Let’s see how things have shaped up prior to this announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for first-quarter earnings per share of $1.33 has witnessed no upward movement and two downward revisions over the past 30 days. The estimated figure suggests a decline of 30.7% from the prior-year reported number.
The Zacks Consensus Estimate for first-quarter revenues of $57.5 billion indicates a 12.2% increase from the year-ago reported figure.
Factors to Note
Per the U.S. Energy Information Administration data, the average West Texas Intermediate crude prices in January, February and March were $78.12, $76.83 and $73.28 per barrel, respectively. Notably, in the year-ago January, February and March, average oil prices were $83.22 per barrel, $91.64 per barrel and $108.50 per barrel, respectively.
Although crude prices were high in the first quarter, the same retreated from their peaks in the year-ago quarter. Natural gas prices saw large declines and were exceptionally volatile in the first quarter, depicting that the upstream business was unfavorable in the quarter. Lower commodity prices are expected to have affected BP’s performance in the to-be-reported quarter.
The Zacks Consensus Estimate for BP’s replacement cost profit before interest and tax from oil production and operations is pegged at $3,561 million, suggesting a decline from $4,683 million in the year-ago quarter. Our estimate for BP’s underlying replacement cost earnings before interest and tax from oil production and operations is pegged at $3,210 million, also reflecting a massive year-over-year decline.
Earnings Whispers
Our proven model does not predict an earnings beat for BP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company’s Earnings ESP is -2.12%. This is because the Most Accurate Estimate is pegged at earnings of $1.31 per share, whereas the Zacks Consensus Estimate is pegged at $1.33. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: BP currently carries a Zacks Rank #3.
Stocks to Consider
While an earnings beat looks uncertain for BP, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Enterprise Products is scheduled to release first-quarter earnings on May 2. The Zacks Consensus Estimate for EPD’s earnings is pegged at 61 cents per share, suggesting an increase from the prior-year reported figure.
TechnipFMC plc (FTI - Free Report) has an Earnings ESP of +16.26% and a Zacks Rank #3 at present.
TechnipFMC is scheduled to release first-quarter earnings on Apr 27. The Zacks Consensus Estimate for FTI’s earnings is pegged at 3 cents per share, suggesting an increase from the prior-year reported figure.
Valero Energy Corporation (VLO - Free Report) has an Earnings ESP of +2.21% and a Zacks Rank #3 at present.
Valero is scheduled to release first-quarter earnings on Apr 27. The Zacks Consensus Estimate for VLO’s earnings is pegged at $7.05 per share, suggesting an increase from the prior-year reported figure.
Image: Bigstock
Factors to Take Into Account Ahead of BP's Q1 Earnings Release
BP plc (BP - Free Report) is set to report first-quarter 2023 results on Feb 7.
In the last reported quarter, the leading integrated energy company’s adjusted earnings of $1.59 per American Depositary Share on a replacement-cost basis (excluding non-operating items) missed the Zacks Consensus Estimate of earnings of $1.65 per share. The quarterly results were driven by a decline in refinery throughputs and a fall in oil-equivalent production. This was offset partially by higher realizations of commodity prices.
In the trailing four quarters, BP beat the Zacks Consensus Estimate for earnings thrice and missed the same once, the average earnings surprise being 21.2%. This is depicted in the graph below:
BP p.l.c. Price and EPS Surprise
BP p.l.c. price-eps-surprise | BP p.l.c. Quote
Let’s see how things have shaped up prior to this announcement.
Trend in Estimate Revision
The Zacks Consensus Estimate for first-quarter earnings per share of $1.33 has witnessed no upward movement and two downward revisions over the past 30 days. The estimated figure suggests a decline of 30.7% from the prior-year reported number.
The Zacks Consensus Estimate for first-quarter revenues of $57.5 billion indicates a 12.2% increase from the year-ago reported figure.
Factors to Note
Per the U.S. Energy Information Administration data, the average West Texas Intermediate crude prices in January, February and March were $78.12, $76.83 and $73.28 per barrel, respectively. Notably, in the year-ago January, February and March, average oil prices were $83.22 per barrel, $91.64 per barrel and $108.50 per barrel, respectively.
Although crude prices were high in the first quarter, the same retreated from their peaks in the year-ago quarter. Natural gas prices saw large declines and were exceptionally volatile in the first quarter, depicting that the upstream business was unfavorable in the quarter. Lower commodity prices are expected to have affected BP’s performance in the to-be-reported quarter.
The Zacks Consensus Estimate for BP’s replacement cost profit before interest and tax from oil production and operations is pegged at $3,561 million, suggesting a decline from $4,683 million in the year-ago quarter. Our estimate for BP’s underlying replacement cost earnings before interest and tax from oil production and operations is pegged at $3,210 million, also reflecting a massive year-over-year decline.
Earnings Whispers
Our proven model does not predict an earnings beat for BP this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.
Earnings ESP: The company’s Earnings ESP is -2.12%. This is because the Most Accurate Estimate is pegged at earnings of $1.31 per share, whereas the Zacks Consensus Estimate is pegged at $1.33. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: BP currently carries a Zacks Rank #3.
Stocks to Consider
While an earnings beat looks uncertain for BP, here are some companies from the Energy space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming quarterly reports:
Enterprise Products Partners L.P. (EPD - Free Report) currently has an Earnings ESP of +0.28% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Enterprise Products is scheduled to release first-quarter earnings on May 2. The Zacks Consensus Estimate for EPD’s earnings is pegged at 61 cents per share, suggesting an increase from the prior-year reported figure.
TechnipFMC plc (FTI - Free Report) has an Earnings ESP of +16.26% and a Zacks Rank #3 at present.
TechnipFMC is scheduled to release first-quarter earnings on Apr 27. The Zacks Consensus Estimate for FTI’s earnings is pegged at 3 cents per share, suggesting an increase from the prior-year reported figure.
Valero Energy Corporation (VLO - Free Report) has an Earnings ESP of +2.21% and a Zacks Rank #3 at present.
Valero is scheduled to release first-quarter earnings on Apr 27. The Zacks Consensus Estimate for VLO’s earnings is pegged at $7.05 per share, suggesting an increase from the prior-year reported figure.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.