What Do Analysts Expect from Helmerich & Payne in Fiscal 3Q16?

Helmerich & Payne’s fiscal 3Q16 earnings estimates

Helmerich & Payne (HP) is expected to hold its fiscal 3Q16 earnings conference call on July 28, 2016. Analysts are expecting $0.44 adjusted loss per share. This means Wall Street analysts expect HP’s adjusted earnings to deteriorate steeply in the coming quarter from fiscal 2Q16’s adjusted loss of $0.28 per share.

Rigs idling or stacking by US upstream companies and lower offshore rig margins in the United States and abroad could lower HP’s fiscal 3Q16 earnings.

Helmerich & Payne posted steady earnings from fiscal 3Q13 through fiscal 1Q15. During this period, its adjusted EPS (earnings per share) increased 18%. But the falling rig count sent its fiscal 2Q15 adjusted EPS crashing 44% compared to the previous quarter. From fiscal 2Q15 through fiscal 2Q16, adjusted earnings switched to a loss.

What Do Analysts Expect from Helmerich & Payne in Fiscal 3Q16?

Helmerich & Payne’s earnings compared to estimates

In fiscal 2Q16, Helmerich & Payne’s adjusted EPS missed analysts’ consensus EPS. As you can see in the above graph, the company’s adjusted EPS exceeded estimates in many past quarters. On average, adjusted EPS has exceeded consensus EPS by ~6% in the past 12 quarters.

Analysts expect Oceaneering International’s (OII) fiscal 3Q16 adjusted earnings to decline to $0.28 per share compared to fiscal 1Q16’s adjusted loss of $0.29. OII provides engineered services and products to the offshore energy industry.

Helmerich & Payne provides contract drilling services to energy upstream operators. HP is 2.6% of the PowerShares High Yield Equity Dividend Achievers ETF (PEY). The energy sector makes up 14.3% of PEY.

Next, we’ll see whether rig counts are affecting HP’s revenues.