A Look at Consol Energy’s 4Q16 Revenue Expectations



Revenue estimates

Consol Energy (CNX) is set to report its 4Q16 and 2016 earnings on January 31, 2017, before the market opens. For 4Q16, Wall Street analysts expect Consol Energy to report ~20.0% lower revenues on a year-over-year basis compared to 4Q15.

Sequentially, Consol Energy’s 4Q16 revenue expectations are ~18.0% lower than 3Q16. For 2016, analysts expect the company to report revenues of ~$2.3 billion, a fall of ~25.0% from ~$3.1 billion in 2015.

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Why Consol Energy reported better revenues in 3Q16

In its 3Q16 earnings release, Consol Energy reported ~160.0% sequential revenue growth from 2Q16. Despite lower production, a steep rise in natural gas (UNG) prices during the quarter helped it report sequentially higher realized prices and revenues in 3Q16. Its natural gas realized price rose to $2.06 per Mcf (thousand cubic feet) in 3Q16, from $1.58 per Mcf in 2Q16.

In 2Q16, Consol Energy’s revenues suffered due to a big loss of ~$199.0 million on natural gas hedges during the quarter, the lowest in the last two years. For 4Q16, CNX has hedged ~63.6 Bcf (billion cubic feet) of natural gas production.

Consol Energy’s peers Devon Energy (DVN) and Occidental Petroleum (OXY) have also reported sequentially higher revenues of $2.9 billion and $2.7 billion, respectively, 3Q16. Marathon Oil (MRO) has reported sequentially lower revenues of $1.2 billion.

The Energy Select Sector SPDR ETF (XLE) generally invests at least 95.0% of its total assets in oil and gas companies.

In this series

We’ve analyzed CNX’s 4Q16 revenue expectations. In the rest of this series, we’ll look at CNX’s EPS (earnings per share) expectations and the odds of the company beating those expectations. We’ll also look at the company’s production guidance, cash flow estimates, and Wall Street analysts’ recommendations ahead of its 4Q16 earnings.


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