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Output & Price Gains to Boost Viper Energy (VNOM) Q3 Earnings
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Viper Energy Partners LP (VNOM - Free Report) is expected to release third-quarter 2018 results on Oct 29, after the closing bell.
In the last reported quarter, the partnership reported weaker-than-expected results on increased costs. However, in the trailing four quarters, Viper Energy surpassed estimates thrice, with an average positive earnings surprise of 6.71%.
The Zacks Consensus Estimate for earnings stands at 41 cents per share on revenues of $77.28 million. Notably, the Zacks Consensus Estimate for earnings has moved south by a penny over a month. However, earnings estimates of 41 cents compare much favorably with the year-ago quarter’s EPS of 24 cents.
Why a Likely Positive Surprise?
Our proven model shows that Viper Energy — the subsidiary of Diamondback Energy, Inc. (FANG - Free Report) — is likely to beat earnings estimates in the to-be-reported quarter, as it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates. 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, is +1.83%. While the Zacks Consensus Estimate is pegged at 41 cents, the Most Accurate Estimate stands a penny higher at 42 cents. A favorable Earnings ESP serves as a meaningful and leading indicator of a likely positive earnings surprise.
Zacks Rank: Viper Energy currently holds a Zacks Rank #1. A Zacks Rank #1, when combined with a positive ESP, makes us confident of an earnings beat.
We caution against Sell-rated stocks (Zacks Ranks #4 and 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
What’s Driving the Better-Than-Expected Earnings?
Viper Energy is likely to realize the benefits of production and pricing gains, which are expected to buoy third-quarter results. The Zacks Consensus Estimate for total oil and gas output is pegged at 17,782 barrels of oil equivalent (71% oil), around 41% higher than the prior-year quarter. Precisely, the Zacks Consensus Estimate for third-quarter oil output of 2018 stands at 1,164.6 thousand barrels (MBbls), up from the year-ago level of 794.4 MBbls. Moreover, gas production is also projected higher at 1453.5 MMcf compared with the year-ago level of 1,236 MMcf. Surge in output is likely to benefit the energy explorer. Further, the partnership is anticipated to realize the benefits from higher realized prices. The Zacks Consensus Estimate for oil price realizations stands at $61 a barrel vis a vis $45.33 fetched a year ago.
Other Stocks That Warrant a Look
Viper Energy is not the only energy firm looking up this earnings season. Here are some other companies from the same space, which, according to our model, also have the right combination of elements to post an earnings beat in the to-be-reported quarter.
Anadarko Petroleum Corporation has an Earnings ESP of +1.90% and holds a Zacks Rank #2. The company is expected to report third-quarter earnings on Oct 30. You can see the complete list of today’s Zacks #1 Rank stocks here.
NOW Inc. (DNOW - Free Report) has an Earnings ESP of +3.03% and a Zacks Rank #2. The firm is expected to release third-quarter earnings on Nov 1.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Output & Price Gains to Boost Viper Energy (VNOM) Q3 Earnings
Viper Energy Partners LP (VNOM - Free Report) is expected to release third-quarter 2018 results on Oct 29, after the closing bell.
In the last reported quarter, the partnership reported weaker-than-expected results on increased costs. However, in the trailing four quarters, Viper Energy surpassed estimates thrice, with an average positive earnings surprise of 6.71%.
Viper Energy Partners LP Price and EPS Surprise
Viper Energy Partners LP Price and EPS Surprise | Viper Energy Partners LP Quote
The Zacks Consensus Estimate for earnings stands at 41 cents per share on revenues of $77.28 million. Notably, the Zacks Consensus Estimate for earnings has moved south by a penny over a month. However, earnings estimates of 41 cents compare much favorably with the year-ago quarter’s EPS of 24 cents.
Why a Likely Positive Surprise?
Our proven model shows that Viper Energy — the subsidiary of Diamondback Energy, Inc. (FANG - Free Report) — is likely to beat earnings estimates in the to-be-reported quarter, as it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates. 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, is +1.83%. While the Zacks Consensus Estimate is pegged at 41 cents, the Most Accurate Estimate stands a penny higher at 42 cents. A favorable Earnings ESP serves as a meaningful and leading indicator of a likely positive earnings surprise.
Zacks Rank: Viper Energy currently holds a Zacks Rank #1. A Zacks Rank #1, when combined with a positive ESP, makes us confident of an earnings beat.
We caution against Sell-rated stocks (Zacks Ranks #4 and 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
What’s Driving the Better-Than-Expected Earnings?
Viper Energy is likely to realize the benefits of production and pricing gains, which are expected to buoy third-quarter results. The Zacks Consensus Estimate for total oil and gas output is pegged at 17,782 barrels of oil equivalent (71% oil), around 41% higher than the prior-year quarter. Precisely, the Zacks Consensus Estimate for third-quarter oil output of 2018 stands at 1,164.6 thousand barrels (MBbls), up from the year-ago level of 794.4 MBbls. Moreover, gas production is also projected higher at 1453.5 MMcf compared with the year-ago level of 1,236 MMcf. Surge in output is likely to benefit the energy explorer. Further, the partnership is anticipated to realize the benefits from higher realized prices. The Zacks Consensus Estimate for oil price realizations stands at $61 a barrel vis a vis $45.33 fetched a year ago.
Other Stocks That Warrant a Look
Viper Energy is not the only energy firm looking up this earnings season. Here are some other companies from the same space, which, according to our model, also have the right combination of elements to post an earnings beat in the to-be-reported quarter.
Anadarko Petroleum Corporation has an Earnings ESP of +1.90% and holds a Zacks Rank #2. The company is expected to report third-quarter earnings on Oct 30. You can see the complete list of today’s Zacks #1 Rank stocks here.
NOW Inc. (DNOW - Free Report) has an Earnings ESP of +3.03% and a Zacks Rank #2. The firm is expected to release third-quarter earnings on Nov 1.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>