Crescent Point Energy Corp. CPG 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 43 cents per share.
Let’s delve into the factors that might have influenced the energy explorer’s results in the June quarter.
Trend in Estimate Revision & Surprise History
The Zacks Consensus Estimate for the second-quarter bottom line has remained the same in the last seven days. The estimated figure indicates a 168.8% improvement year over year.
Crescent Point missed the Zacks Consensus Estimate for earnings in three of the last four quarters, resulting in an earnings surprise of -17.2%, on average. This is depicted in the graph below:
Crescent Point Energy Corporation Price and EPS Surprise
Crescent Point Energy Corporation price-eps-surprise | Crescent Point Energy Corporation Quote
Factors to Consider
Crescent Point Energy is expected to have benefited from a surge in commodity price realizations. In the January-to-March period, the company’s average oil and natural gas selling prices were up 74% and 23% year over year, respectively. The uptick is most likely to have continued in the second quarter, with commodity prices remaining strong on the back of geopolitical tensions, strained supply and robust demand. This price boost is likely to have buoyed the revenues and cash flows of the Canadian firm.
On a somewhat bearish note, Crescent Point is likely to have experienced a dip in its production after it disposed off the southeast Saskatchewan assets in the second quarter of 2021. Consequently, the consensus mark for CPG’s average daily Q2 volume is pegged at 125,000 barrels of oil equivalent per day (BOE/d), down from the prior-year quarter’s level of 148,641 BOE/d.
The increase in Crescent Point’s costs might have also dented the company’s to-be-reported bottom line. CPG’s operating expense in the first quarter climbed to C$168.7 million from C$142.6 million in the year-earlier period. The upward cost trajectory is likely to have continued in the June quarter due to inflationary pressure across the board.
What Does Our Model Say?
The proven Zacks model does not conclusively show that Crescent Point 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: CPG has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 43 cents per share each.
Zacks Rank: Crescent Point currently carries a Zacks Rank #5 (Strong Sell).
Stocks to Consider
While an earnings beat looks uncertain for Crescent Point, here are some firms from the energy space that you may want to consider on the basis of our model:
Range Resources Corporation RRC 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 has an Earnings ESP of +46.25% and a Zacks Rank #2. 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 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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