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What's in Store for Martin Midstream (MMLP) in Q2 Earnings?

Martin Midstream Partners MMLP is scheduled to release second-quarter 2020 results on Jul 27, 2020.

The partnership’s bottom line outperformed estimates in three of the last four quarters and lagged the same in the remaining one. The average beat is in excess of 100%.

Martin Midstream Partners L.P. Price and EPS Surprise

 

Martin Midstream Partners L.P. Price and EPS Surprise

Martin Midstream Partners L.P. price-eps-surprise | Martin Midstream Partners L.P. Quote

For the to-be-reported quarter, the Zacks Consensus Estimate for the firm’s bottom line has remained stable at a loss of 13 cents over the past 60 days. Against this backdrop, let’s take a look at the factors that might have shaped the company’s June-quarter performance.

A lower refinery utilization and coronavirus-induced demand weakness are likely to have dented the partnership’s performance in the to-be-reported quarter. Performance of the Terminalling and Storage segment might have been adversely impacted by soft demand for lubricants.

On a brighter note, in the Sulfur Services segment, fertilizer sales, which were weak in the March quarter, are likely to have improved in the June quarter. This was confirmed by the management during the first-quarter earnings. The Zacks Consensus Estimate for fertilizer sales volume indicates an 18.9% rise from the sequentially reported figure. However, reduced refinery utilization might have hurt sulfur volumes in the June quarter. The Zacks Consensus Estimate for sulfur sales volume suggests a 0.5% dip, sequentially.

Moreover, margin weakness in the partnership’s butane logistics business might have dented the performance of the Natural Gas Liquids segment. The Zacks Consensus Estimate for the segmental sales volume implies a 41% decline from the number reported in the first quarter.

What Does Our Model Say?

The proven Zacks model predicts a bottom-line outperformance for Martin Midstream this time around. 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. However, that is not the case here as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Martin Midstream has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Martin Midstream sports a Zacks Rank of 1, currently.

Highlights of Q1

In the last reported quarter, Martin Midstream reported a loss of 22 cents per unit, wider than the Zacks Consensus Estimate of a loss of 9 cents. However, the loss per unit narrowed year over year. Revenues too increased year over year.

Stocks to Consider

Investors interested in the broader Transportation sector may check out a few stocks worth considering like United Airlines UAL, C.H. Robinson Worldwide CHRW and Air Lease Corporation AL as these possess the perfect combination to beat estimates.

United Airlines has an Earnings ESP of +21.37% and a Zacks Rank #3, currently. The company will release second-quarter 2020 results on Jul 21.

C.H. Robinson has an Earnings ESP of +6.02% and is a #3 Ranked player at present. The company will release second-quarter 2020 results on Jul 28.

Air Lease has an Earnings ESP of +23.32% and is Zacks #3 Ranked at present. The company will release second-quarter 2020 results on Aug 6.

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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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