1Q16 estimated and actual performance
Eni (E) will post its 2Q16 results on July 29, 2016. Before we proceed with 2Q16 estimates, let’s recap Eni’s 1Q16 performance compared to analysts’ estimates.
In 1Q16, Eni reported EPS (earnings per share) of -0.48 euros for the quarter. After adjusting for special items, Eni’s adjusted EPS stood at -0.04 euros in 1Q16—in line with its estimated EPS of -0.04 euros.
Eni’s adjusted operating earnings from continuing operations stood at 73 million euros in 1Q16—compared to 1,418 million euros in 1Q15. The steep decline in adjusted operating earnings was due to the sharp fall in earnings in the E&P (exploration and production) segment.
Eni’s 2Q16 estimates
In 2Q16, analysts expect Eni to post EPS of 0.14 euros. This is 86% higher than its 2Q15 adjusted EPS. Analysts estimate Eni’s revenue to be ~12.8 billion euros in 2Q16—43% lower than its 2Q15 revenue.
Earnings from the company’s E&P segment will likely improve due to higher oil prices in 2Q16—compared to 1Q16. Also, Eni’s downstream segment will likely have a better performance because refining cracks have widened in 2Q16—compared to 1Q16.
However, on a year-over-year basis, Eni’s earnings are expected to decline. Eni’s peers such as Petrobras (PBR), ExxonMobil (XOM), and Chevron (CVX) are also expected to post a steep decline in earnings in 2Q16—compared to 2Q15. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) has ~6% exposure to integrated energy sector stocks.