Is a Beat in Store for Range Resources (RRC) in Q1 Earnings?

Shutterstock photo

Range Resources Corporation RRC is expected to report first-quarter 2018 earnings on Apr 25, after the closing bell.

In the last reported quarter, the upstream energy company posted a positive earnings surprise of 46.7%. Moreover, Range Resources has an average positive earnings surprise of 53.5% for the last four quarters. Let's see how things are shaping up prior to the announcement.

Which Way Are Estimates Treading?

Now, let's analyze the estimate revision trend in order to get a clear picture of what analysts are expecting from the upcoming earnings release.

The Zacks Consensus Estimate for first-quarter earnings of 47 cents has seen six upward revisions and one downward revision by firms in the last 60 days. It reflects an improvement of about 88% from the year-ago quarter.

Further, analysts polled by Zacks expect revenues of $715 million for the quarter, down 7.9% from a year ago.

Factors to Consider

Range Resources is among the leading explorers of natural gas and oil in the prospective resources of Appalachian Basin and North Louisiana.

The Zacks Consensus Estimate for total first-quarter production is pegged at 2,175 million cubic feet equivalent per day (MMcfe/d), up from 2,170 MMcfe/d reported in the prior quarter and 1,931.9 MMcfe/d in the year-ago quarter.

The Zacks Consensus Estimate for the company's natural gas price realizations - including hedging - is pegged at $3.03 per Mcf, up from $3.02 per Mcf in fourth-quarter 2017 but down from $3.19 recorded in the January-to-March quarter of 2017.

Higher expected average daily production and favorable sequential natural gas price realizations might drive earnings.

Price Performance in Q1

During the quarter, Range Resources has underperformed its  industry , with the stock losing 14.8% compared with the industry's decline of 4.1%.    

Earnings Whispers

Our proven model shows that Range Resources is likely to beat earnings this time because it has the right combination of two key ingredients.  

Zacks ESP Earnings ESP for the company is +6.09% as the Most Accurate estimate of 50 cents is higher than the Zacks Consensus Estimate of 47 cents. You can uncover the best stocks to buy or sell before they're reported with our  Earnings ESP Filter .

Zacks Rank : Range Resources carries a Zacks Rank #3 (Hold). Note that stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 have a significantly higher chance of beating on earnings. The combination of Range Resources' favorable Zacks Rank and Earnings ESP makes us confident about an earnings beat.  

Conversely, Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.

Other Stocks to Consider

Here are a few other firms that you may want to consider on the basis of our model. These have the right combination of elements to post an earnings beat this quarter.

Comstock Resources, Inc. CRK is an oil and gas explorer. The company has an Earnings ESP of +37.34% and a Zacks Rank #2. You can see  the complete list of today's Zacks #1 Rank stocks here .

Oil States International, Inc. OIS is a leading oilfield services player. The company has an Earnings ESP of + 32.83% and a Zacks Rank #2.

Pioneer Natural Resources Company PXD is an upstream energy company. The company has an Earnings ESP of +2.15% and a Zacks Rank #3.

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Oil States International, Inc. (OIS): Free Stock Analysis Report

Range Resources Corporation (RRC): Free Stock Analysis Report

Pioneer Natural Resources Company (PXD): Free Stock Analysis Report

Comstock Resources, Inc. (CRK): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Earnings , Stocks
Referenced Symbols: OIS , RRC , PXD , CRK

More from Zacks.com




Equity Research

Research Brokers before you trade

Want to trade FX?