Yahoo Finance Diamondback (FANG) to Report Q1 Earnings: What's in Store?
Diamondback Energy FANG is set to release first-quarter results on May 1. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $4.41 per share on revenues of $2 billion.
Let’s delve into the factors that might have influenced the Permian-focused oil and gas producer’s performance in the March quarter. But it’s worth taking a look at FANG’s previous-quarter performance first.
Highlights of Q4 Earnings & Surprise History
In the last reported quarter, this Midland, TX-based upstream player beat the consensus mark due to higher-than-expected oil and gas production. Diamondback had reported adjusted earnings per share of $5.29 for the fourth quarter, ahead of the Zacks Consensus Estimate of $5.20. However, revenues of $2 billion fell marginally short of the Zacks Consensus Estimate due to lower overall realization.
FANG beat the Zacks Consensus Estimate for earnings in three of the last four quarters and missed in the other, resulting in an earnings surprise of 4.3%, on average. This is depicted in the graph below:
Diamondback Energy, Inc. Price and EPS Surprise
Diamondback Energy, Inc. price-eps-surprise | Diamondback Energy, Inc. Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for the first-quarter bottom line has been revised 5.8% downward in the past seven days. The estimated figure indicates a 15.2% fall year over year. The Zacks Consensus Estimate for revenues, meanwhile, suggests a 19% increase from the year-ago period.
Factors to Consider
Diamondback Energy is expected to have benefited from higher production during the quarter. The company continues to churn out impressive volumes from its wide inventory of drill-ready locations in the Permian Basin — America's hottest and lowest-cost shale region. Consequently, the consensus mark for FANG’s average Q1 volume is pegged at 421,752 barrels of oil equivalent per day (BOE/d), up from the prior-year quarter’s level of 381,378 BOE/d.
On a somewhat bearish note, the increase in Diamondback Energy’s costs might have dented its to-be-reported bottom line. FANG’s lease operating cost was $4.47 per barrel of oil equivalent (BOE) in the fourth quarter, up 6.2% from the prior-year quarter. The upward cost trajectory is likely to have continued in the first quarter.
What Does Our Model Say?
The proven Zacks model does not conclusively show that Diamondback Energy is likely to beat estimates in the first 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: Diamondback Energy has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $4.41 per share each.
Zacks Rank: FANG currently carries a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction difficult this earnings season.
Stocks to Consider
While an earnings beat looks uncertain for Diamondback Energy, here are some firms from the energy space that you may want to consider on the basis of our model:
Marathon Petroleum MPC has an Earnings ESP of +1.19% and a Zacks Rank #1. The firm is scheduled to release earnings on May 2.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for MPC’s 2023 earnings has been revised 17.4% upward over the past 60 days. Valued at around $56.4 billion, Marathon Petroleum has gained 46.5% in a year.
TechnipFMC FTI has an Earnings ESP of +16.26% and a Zacks Rank #3. The firm is scheduled to release earnings on Apr 27.
For 2023, TechnipFMC has a projected earnings growth rate of 1,733.3%. Valued at around $6 billion, FTI has gained 68.4% in a year.
Canadian Natural Resources CNQ has an Earnings ESP of +4.29% and a Zacks Rank #3. The firm is scheduled to release earnings on May 4.
Canadian Natural Resources delivered a four-quarter average earnings surprise of 10.5%. Valued at around $66.3 billion, CNQ has lost 3.4% in a year.
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TechnipFMC plc (FTI) : Free Stock Analysis Report
Canadian Natural Resources Limited (CNQ) : Free Stock Analysis Report
Marathon Petroleum Corporation (MPC) : Free Stock Analysis Report
Diamondback Energy, Inc. (FANG) : Free Stock Analysis Report
