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How Will Cabot Oil & Gas Fare in 3Q16?

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3Q16 earnings release

Cabot Oil & Gas (COG) is expected to release its fiscal 3Q16 earnings results on October 28, 2016. Its 3Q16 revenue estimate is higher than its revenue for the previous two quarters. For 3Q16, its revenue estimate is ~$323 million, ~6% higher than its 3Q15 revenue and ~18% higher than its 2Q16 revenue.

As shown in the above graph, Cabot’s revenues were in line with estimates in the previous two quarters. Investors should watch to see if this trend continues in 3Q16.

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Cabot Oil & Gas: 3Q16 earnings estimates

Cabot’s estimated 3Q16 EPS (earnings per share) are approximately -$0.03. Its 2Q16 EPS were -$0.07, and in 2Q15, they stood at -$0.01. As shown above, Cabot’s earnings have mostly come in better than expected in previous quarters. Keep following Market Realist to see if this trend will continue in 2Q16 as well.

Peers EQT (EQT) and Noble Energy (NBL) are expected to report EPS of -$0.38 and -$0.22, respectively, in 3Q16. These companies make up 6% of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP)

Key 2Q16 management commentary

With the release of Cabot’s 2Q16 earnings, CEO Dan Dinges stated that “the Company grew equivalent production 10 percent relative to the second quarter of last year while generating operating cash flow that exceeded our capital expenditures, pipeline investments, and dividends.” He noted that this was in line with COG‘s 2016 operating plan “to provide modest production growth while generating positive free cash flow despite a lower commodity price environment.” Dinges added that “we anticipate significantly more positive free cash flow generation in the second half of the year based on the current commodity price outlook.”

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