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What to Expect from Apache Corporation’s 4Q15 Earnings

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Apache’s 4Q15 revenue estimates

Apache Corporation (APA) will release its 4Q15 earnings on February 25, 2016. Its 4Q15 revenue estimates stand at ~$1.4 billion. The company’s revenue in 4Q14 was ~$3 billion.

In 3Q15, Apache reported revenue of ~$1.5 billion, ~60% lower than its 3Q14 revenue. Sequentially, its revenue decreased by 24%. As we can see above, APA’s revenues had fallen short of analysts’ estimates in 3Q15, but it had managed to beat estimates in the quarters before that.

Keep following Market Realist to see which of these trends could manifest in 4Q15. Note that analysts expect APA’s 4Q15 revenues to be lower than all of the previous quarters in 2015.

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Apache’s 4Q15 earnings per share estimate

Apache Corporation’s 4Q15 loss per share estimate is ~$0.50. Its 4Q14 earnings per share (or EPS) was ~$1.10. The 3Q15 loss per share was $0.05.

Upstream peers Hess Corporation (HES) and Anadarko Petroleum (APC) reported a 4Q15 loss per share of ~$1.50 and $0.57, respectively. Marathon Oil (MRO) is expected to post a 4Q15 loss per share of ~$0.47. All these companies make up ~6.7% of the Energy Select Sector SPDR ETF (XLE).

Apache’s fiscal 2015 revenue and earnings estimates

For 2015, analysts expect Apache Corporation to report revenue of ~$6.7 billion, ~52% lower than the 2014 revenue of $13.8 billion. Analysts expect APA to report an adjusted 2015 loss per share of ~$0.74, versus 2014’s profit per share of ~$5.90.

Why were Apache’s revenue and EPS estimates lowered?

The sub-$40 oil prices in 4Q15 were yet another blow to upstream oil companies, which were already buckling under a weak energy price environment. This explains the lower 4Q15 revenue and EPS estimates for Apache Corporation. Lower prices could mean lower price realizations for the company.

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