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Cheniere Energy Partners (CQH) Q4 Earnings: What's in Store?

Cheniere Energy Partners LP Holdings LLCCQH is expected to report fourth-quarter 2016 results on Feb 17.

In the last four quarters, the company delivered an earnings surprise of 0.00%. Let's see how things are shaping up for this announcement.

Factors to Consider this Quarter

The company, by virtue of its 55.9% ownership in Cheniere Energy Partners LP (CQP), primarily operates the Sabine Pass natural gas regasification and liquefaction facilities. Cheniere Energy Partners LP Holdings also operates Creole Trail Pipeline in Louisiana. This solid asset base might help the company to earn sufficiently for its shareholders.

Moreover, the midstream player's business is positively correlated to natural gas production. For most of the fourth quarter, natural gas rig count in the U.S plays continued to increase according to the rig count data issued by Baker Hughes Inc. BHI .

Increase in rig count should result in more output. Hence, the business environment was favorable for the company as higher production of natural gas usually increases the need for regasification, liquefaction and transportation activities.

Additionally, Cheniere Energy Partners LP Holdings shares have outperformed the Zacks categorized Oil & Gas-Production/Pipeline industry in the last three months. During the aforesaid period, Cheniere Energy Partners gained 19.3% compared with 6.1% improvement for the broader industry.

We have to wait for the final earnings release to find out whether this increase in output translates into a positive surprise.

Earnings Whispers

Our proven model does not conclusively show that Cheniere Energy Partners LP Holdings is likely to beat on earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here, as you will see below.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 2 cents. As a result the Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks Rank: Cheniere Energy Partners LP Holdings has a Zacks Rank #3 (Hold), which increases the predictive power of ESP. However, we need a positive Earnings ESP to be confident of a beat.

We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when a firm is seeing negative estimate revisions.

Stocks to Consider

Here are some companies that have the right combination of elements to post an earnings beat this quarter:

Southwestern Energy Company SWN , which is expected to release earnings results on Feb 23, has an Earnings ESP of +8.33% and a Zacks Rank #3. You can see the complete list of today's Zacks #1 Rank stocks here .

EOG Resources, Inc. EOG has an Earnings ESP of +6.67% and a Zacks Rank #3. The company is expected to release earnings results on Feb 27.

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Cheniere Energy Partners LP Holdings, LLC (CQH): Free Stock Analysis Report

EOG Resources, Inc. (EOG): Free Stock Analysis Report

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


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

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