Earnings Estimates Rising for ConocoPhillips (COP): Will It Gain?

ConocoPhillips (COP) appears an attractive pick given a noticeable improvement in the company's earnings outlook. The stock has been a strong performer lately, and the momentum might continue with analysts still raising their earnings estimates for the company.

Analysts' growing optimism on the earnings prospects of this energy company is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

For ConocoPhillips, strong agreement among the covering analysts in revising earnings estimates upward has resulted in meaningful improvement in consensus estimates for the next quarter and full year.

Current-Quarter Estimate Revisions

The earnings estimate of $2.11 per share for the current quarter represents a change of -11.34% from the number reported a year ago.

Over the last 30 days, five estimates have moved higher for ConocoPhillips while one has gone lower. As a result, the Zacks Consensus Estimate has increased 8.47%.

Current-Year Estimate Revisions

For the full year, the earnings estimate of $9.47 per share represents a change of +7.98% from the year-ago number.

In terms of estimate revisions, the trend for the current year also appears quite encouraging for ConocoPhillips. Over the past month, seven estimates have moved higher compared to no negative revisions, helping the consensus estimate increase 7.68%.

Favorable Zacks Rank

The promising estimate revisions have helped ConocoPhillips earn a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

While strong estimate revisions for ConocoPhillips have attracted decent investments and pushed the stock 5.2% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.

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ConocoPhillips (COP) : 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.

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