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What Does Noble Energy’s Earnings Trend Point to for 4Q15?

Nicholas Chapman

Will Noble Energy's Downtrend Continue in 4Q15?

Noble Energy’s 4Q15 earnings and revenues estimates

Noble Energy (NBL) is set to report its 4Q15 earnings on February 17, 2016. For 4Q15, Wall Street analysts expect NBL to report an adjusted loss of $0.02 per share, which is lower by $0.40 per share when compared to its 4Q14 profit of $0.38 per share. When compared sequentially with 3Q15, NBL’s 4Q15 earnings expectations are higher by $0.19 per share.

For 4Q15, Wall Street analysts expect NBL to report revenues of ~$1.06 billion, lower by ~1% when compared to its 4Q14 revenues of ~$1.07 billion. When compared sequentially with 3Q15, NBL’s 4Q15 revenue expectations are higher by ~32%. The higher quarter-over-quarter revenue expectations for 4Q15 are the result of NBL’s acquisition of Rosetta Resources, which was completed in 3Q15.

NBL’s earnings trend

As seen in the above chart, NBL has reported much lower earnings in 2015 due to lower realized crude oil and natural gas prices. In 3Q15, NBL saw its adjusted earnings turn negative for the first time since 2003.

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In 3Q15, excluding one-time items, NBL reported a loss of $0.21 per share, $0.04 worse than analysts’ consensus estimate of a loss of $0.17 per share. Its revenues fell ~37% year-over-year to ~$801 million. Since 1Q13, NBL has beat earnings expectations ~63% of the time.

Almost all S&P 500 (SPY) upstream companies have been hit by the steep downward trend in energy prices. Southwestern Energy (SWN), EOG Resources (EOG), and Range Resources (RRC) are expected to report year-over-year falls of ~20%, ~37%, and ~52%, respectively, in their 4Q15 revenues.

NBL’s 2015 earnings and revenue estimates

For 2015, Wall Street analysts expect NBL to report an adjusted loss of $0.03 per share, lower by $2.39 per share compared to its 2014 profit of $2.36 per share.

For 2015, Wall Street analysts expect NBL to report revenues of ~$3.5 billion, lower by ~28% compared to its 2014 revenues of ~$4.9 billion.

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