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Factors to Pay Attention to Ahead of BP's Q4 Earnings Release

BP plc BP is set to report fourth-quarter 2022 results on Feb 7.

In the last reported quarter, the leading integrated energy company surpassed the Zacks Consensus Estimate, thanks to higher production and realizations of commodity prices. It beat the consensus estimate in all the prior four quarters, the average earnings surprise being 23.1%. This is depicted in the graph below:

Let’s see how things have shaped up prior to this announcement.

BP p.l.c. Price and EPS Surprise

BP p.l.c. Price and EPS Surprise
BP p.l.c. Price and EPS Surprise

BP p.l.c. price-eps-surprise | BP p.l.c. Quote

Trend in Estimate Revision

The Zacks Consensus Estimate for fourth-quarter earnings per share of $1.65 has witnessed two downward revisions over the past 30 days. The estimated figure suggests an improvement of 34.2% from the prior-year reported number.

The consensus estimate for fourth-quarter revenues of $59.5 billion indicates a 13.9% rise from the year-ago reported figure.

Factors to Consider

Per data provided by the U.S. Energy Information Administration (“EIA”), the average West Texas Intermediate crude prices in October, November and December were recorded at $87.55 per barrel, $84.37 per barrel and $76.44 per barrel, respectively. In comparison, in the year-ago respective months, average oil prices were reported at $81.48 per barrel, $79.15 per barrel and $71.71 per barrel, per the EIA’s data.

Higher oil prices favored exploration and production activities, and convinced more explorers and producers to return to oil patches. The pricing scenario of natural gas was also healthy, depicting that the upstream business was lucrative in the fourth quarter.

Our estimate for BP’s underlying replacement cost earnings before interest and tax from oil production & operations is pegged at $4,589.5 million, suggesting an improvement from $4,024 million in a year-ago quarter.

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 -1.06%. 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:

Viper Energy Partners LP VNOM has an Earnings ESP of +3.57% 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 fourth-quarter results on Feb 21. The Zacks Consensus Estimate for VNOM’s earnings is pegged at 27 cents per share.

Sunoco LP SUN has an Earnings ESP of +1.95% and a Zacks Rank of 1.

Sunoco is scheduled to report fourth-quarter results on Feb 15. The Zacks Consensus Estimate for SUN’s earnings is pegged at 77 cents per share.

PBF Energy PBF has an Earnings ESP of +7.90% and a Zacks Rank #3.

PBF Energy is scheduled to release fourth-quarter earnings on Feb 16. The Zacks Consensus Estimate for PBF’s earnings is pegged at $4.52 per share, suggesting a massive increase from the prior-year reported figure.

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

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BP p.l.c. (BP) : Free Stock Analysis Report

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