Odds of beating earnings estimates
In the last four quarters, Southwestern Energy (SWN) beat the consensus EPS estimates in Q4 2017 and Q1 2018. However, SWN missed EPS estimates in Q2 2017 and Q3 2017. Thus, in the last four quarters, SWN beat the consensus EPS estimate 50% of the time and missed the consensus EPS estimate 50% of the time.
Other oil and gas producers
In the last four quarters, other upstream players like Encana (ECA), Pioneer Natural Resources (PXD), and Murphy Oil (MUR) have exceeded earnings expectations ~75%, ~100%, and ~75% of the time, respectively.
What was SWN’s stock price reaction to Q1 2018 earnings?
Southwestern Energy announced its Q1 2018 earnings on April 26 after the market closed. In the first quarter of 2018, Southwestern Energy reported revenues of ~$920 million, much better than the Wall Street analyst consensus of ~$847 million. SWN also beat EPS estimates by $0.03 in Q1 2018. SWN reported adjusted profit of $0.28 per share, whereas the Wall Street analyst consensus was for profit of $0.25 per share.
After the earnings release, better-than-expected earnings led Southwestern Energy’s stock to fall from $4.52 to $3.96 in one week.
SWN’s year-to-date performance
Year-to-date in 2018, SWN is one of the negatively performing upstream companies with returns of -6%. SWN is also broadly underperforming the SPDR S&P Oil and Gas Exploration & Production ETF (XOP), which represents an index of stocks across the energy industry. XOP has ~81% exposure to the oil and gas exploration and production industry. XOP is up by ~16% in 2018. To know more about the best upstream stock performers in 2018, check out Market Realist’s series How Is the Energy Sector Performing in 2018?